{"url_path":"/sec/oesx/10-k/2026/item-8","section_key":"item-8","section_title":"Item 8 FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA","topic":"sec","document":{"doc_type":"10-K","doc_date":"2026-06-04","source_url":"https://www.sec.gov/Archives/edgar/data/1409375/0001193125-26-257468-index.html","accession_number":"0001193125-26-257468","cik":"0001409375","ticker":"OESX","issuer_name":"ORION ENERGY SYSTEMS, INC.","edgar_url":"https://www.sec.gov/Archives/edgar/data/1409375/0001193125-26-257468-index.html","primary_entity_key":"0001409375","primary_entity_name":"ORION ENERGY SYSTEMS, INC."},"word_count":16945,"has_tables":true,"body_markdown":"ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA\n\nINDEX TO CONSOLIDATED FINANCIAL STATEMENTS\n\n \n\n \n\nPage\n\nNumber\n\n[Report of Independent Registered Public Accounting Firm](#report_independent_accounting_firm) (BDO USA, P.C.; Milwaukee, WI; PCAOB ID#243)\n\n43\n\n[Consolidated Balance Sheets](#consolidated_balance_sheets)\n\n45\n\n[Consolidated Statements of Operations](#consolidated_statements_operations_compr)\n\n46\n\n[Consolidated Statements of Shareholders’ Equity](#statements_shareholders_equity)\n\n47\n\n[Consolidated Statements of Cash Flows](#consolidated_statements_cash_flows)\n\n48\n\n[Notes to Consolidated Financial Statements](#notes_to_consolidated_financial_statemen)\n\n49\n\n \n\n42\n\n \n\nReport of Independent Registered Public Accounting Firm\n\nShareholders and Board of Directors\n\nOrion Energy Systems, Inc.\n\nManitowoc, Wisconsin\n\nOpinion on the Consolidated Financial Statements\n\nWe have audited the accompanying consolidated balance sheets of Orion Energy Systems, Inc. (the “Company”) as of March 31, 2026 and 2025, the related consolidated statements of operations, shareholders’ equity, and cash flows for each of the three years in the period ended March 31, 2026, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at March 31, 2026 and 2025, and the results of its operations and its cash flows for each of the three years in the period ended March 31, 2026, in conformity with accounting principles generally accepted in the United States of America.\n\nBasis for Opinion\n\nThese consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.\n\nWe conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.\n\nOur audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.\n\nCritical Audit Matter\n\nThe critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.\n\nInventory - Valuation\n\nAs described in Note 2 to the Company’s consolidated financial statements, the Company reports inventory using the first-in, first-out (FIFO) method. The Company records the amount required to reduce the carrying value of its inventories to net realizable value as a charge to cost of product revenue. As of March 31, 2026, the Company had inventories, net of approximately $10.3 million.\n\nWe identified Inventory Valuation as a critical audit matter. The principal considerations for this determination were management’s judgments utilized to determine the net realizable value of inventory, specifically the assumptions related to the recent historical sales activity (including usage in the preceding 9 to 12 months) and expected demand for the products. Auditing these elements involved especially subjective auditor judgment due to the nature and extent of audit effort required to address this matter.\n\n43\n\n \n\nThe primary procedures we performed to address this critical audit matter included:\n\n•\nAssessing the reasonableness of management’s assumptions over historical sales activity, including testing the completeness and accuracy of underlying data and corroborating management’s considerations of usage trends during the preceding 9 to 12 months, on a sample basis.\n\n•\nAssessing the reasonableness of management’s assumptions over expected demand for products, by comparing parts identified for substitutions when applicable and testing usage subsequent to year-end and other subsequent transactions, on a sample basis.\n\n/s/ BDO USA, P.C.\n\nWe have served as the Company's auditor since 2011.\n\nMilwaukee, Wisconsin\n\nJune 4, 2026\n\n \n\n44\n\n \n\nORION ENERGY SYSTEMS, INC. AND SUBSIDIARIES\n\nCONSOLIDATED BALANCE SHEETS\n\n \n\n \n\n \n\nMarch 31,\n\n \n\n(in thousands, except share amounts)\n\n \n\n2026\n\n \n\n \n\n2025\n\n \n\nAssets\n\n \n\n \n\n \n\n \n\n \n\n \n\nCash and cash equivalents\n\n \n\n$\n\n3,265\n\n \n\n \n\n$\n\n5,972\n\n \n\nAccounts receivable, net\n\n \n\n \n\n16,340\n\n \n\n \n\n \n\n12,845\n\n \n\nRevenue earned but not billed\n\n \n\n \n\n6,409\n\n \n\n \n\n \n\n3,350\n\n \n\nInventories, net\n\n \n\n \n\n10,304\n\n \n\n \n\n \n\n11,392\n\n \n\nPrepaid expenses and other current assets\n\n \n\n \n\n1,364\n\n \n\n \n\n \n\n1,939\n\n \n\nTotal current assets\n\n \n\n \n\n37,682\n\n \n\n \n\n \n\n35,498\n\n \n\nProperty and equipment, net\n\n \n\n \n\n6,114\n\n \n\n \n\n \n\n8,026\n\n \n\nGoodwill\n\n \n\n \n\n1,484\n\n \n\n \n\n \n\n1,484\n\n \n\nOther intangible assets, net\n\n \n\n \n\n2,646\n\n \n\n \n\n \n\n3,379\n\n \n\nOther long-term assets, net\n\n \n\n \n\n3,679\n\n \n\n \n\n \n\n4,076\n\n \n\nTotal assets\n\n \n\n$\n\n51,605\n\n \n\n \n\n$\n\n52,463\n\n \n\nLiabilities and Shareholders’ Equity\n\n \n\n \n\n \n\n \n\n \n\n \n\nAccounts payable\n\n \n\n$\n\n15,451\n\n \n\n \n\n$\n\n13,272\n\n \n\nAccrued expenses and other\n\n \n\n \n\n10,728\n\n \n\n \n\n \n\n12,728\n\n \n\nDeferred revenue, current\n\n \n\n \n\n155\n\n \n\n \n\n \n\n491\n\n \n\nCurrent maturities of long-term debt\n\n \n\n \n\n353\n\n \n\n \n\n \n\n353\n\n \n\nTotal current liabilities\n\n \n\n \n\n26,687\n\n \n\n \n\n \n\n26,844\n\n \n\nRevolving credit facility\n\n \n\n \n\n3,000\n\n \n\n \n\n \n\n7,000\n\n \n\nLong-term debt, less current maturities\n\n \n\n \n\n2,619\n\n \n\n \n\n \n\n2,971\n\n \n\nDeferred revenue, long-term\n\n \n\n \n\n-\n\n \n\n \n\n \n\n337\n\n \n\nOther long-term liabilities\n\n \n\n \n\n2,671\n\n \n\n \n\n \n\n3,427\n\n \n\nTotal liabilities\n\n \n\n \n\n34,977\n\n \n\n \n\n \n\n40,579\n\n \n\nCommitments and contingencies (Note 14)\n\n \n\n \n\n \n\n \n\n \n\n \n\nShareholders’ equity:\n\n \n\n \n\n \n\n \n\n \n\n \n\nPreferred stock, $0.01 par value: Shares authorized: 30,000,000 shares\n   at March 31, 2026 and 2025; no shares issued and outstanding at\n   March 31, 2026 and 2025\n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\nCommon stock, no par value: Shares authorized: 20,000,000 at\n   March 31, 2026 and 2025; shares issued: 4,819,013 and\n  4,247,023 at March 31, 2026 and 2025; shares outstanding:\n   4,056,528 and 3,298,389 at March 31, 2026 and 2025\n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\nAdditional paid-in capital\n\n \n\n \n\n169,646\n\n \n\n \n\n \n\n163,025\n\n \n\nTreasury stock: 762,485 and 948,634 common shares at\n   March 31, 2026 and 2025\n\n \n\n \n\n(34,962\n\n)\n\n \n\n \n\n(36,248\n\n)\n\nAccumulated deficit\n\n \n\n \n\n(118,056\n\n)\n\n \n\n \n\n(114,893\n\n)\n\nTotal shareholders’ equity\n\n \n\n \n\n16,628\n\n \n\n \n\n \n\n11,884\n\n \n\nTotal liabilities and shareholders’ equity\n\n \n\n$\n\n51,605\n\n \n\n \n\n$\n\n52,463\n\n \n\nThe accompanying notes are an integral part of these Consolidated Financial Statements.\n\n45\n\n \n\nORION ENERGY SYSTEMS, INC. AND SUBSIDIARIES\n\nCONSOLIDATED STATEMENTS OF OPERATIONS\n\n \n\n \n\n \n\nFiscal Year Ended March 31,\n\n \n\n(in thousands, except share and per share amounts)\n\n \n\n2026\n\n \n\n \n\n2025\n\n \n\n \n\n2024\n\n \n\nProduct revenue\n\n \n\n$\n\n57,029\n\n \n\n \n\n$\n\n54,368\n\n \n\n \n\n$\n\n63,307\n\n \n\nService revenue\n\n \n\n \n\n29,277\n\n \n\n \n\n \n\n25,352\n\n \n\n \n\n \n\n27,274\n\n \n\nTotal revenue\n\n \n\n \n\n86,306\n\n \n\n \n\n \n\n79,720\n\n \n\n \n\n \n\n90,581\n\n \n\nCost of product revenue\n\n \n\n \n\n36,893\n\n \n\n \n\n \n\n37,319\n\n \n\n \n\n \n\n44,466\n\n \n\nCost of service revenue\n\n \n\n \n\n21,320\n\n \n\n \n\n \n\n22,165\n\n \n\n \n\n \n\n25,204\n\n \n\nTotal cost of revenue\n\n \n\n \n\n58,213\n\n \n\n \n\n \n\n59,484\n\n \n\n \n\n \n\n69,670\n\n \n\nGross profit\n\n \n\n \n\n28,093\n\n \n\n \n\n \n\n20,236\n\n \n\n \n\n \n\n20,911\n\n \n\nOperating expenses:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nGeneral and administrative\n\n \n\n \n\n18,691\n\n \n\n \n\n \n\n18,008\n\n \n\n \n\n \n\n16,740\n\n \n\nImpairment on intangibles\n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n456\n\n \n\nAcquisition related costs\n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n56\n\n \n\nSales and marketing\n\n \n\n \n\n10,099\n\n \n\n \n\n \n\n11,595\n\n \n\n \n\n \n\n12,988\n\n \n\nResearch and development\n\n \n\n \n\n945\n\n \n\n \n\n \n\n1,229\n\n \n\n \n\n \n\n1,495\n\n \n\nTotal operating expenses\n\n \n\n \n\n29,735\n\n \n\n \n\n \n\n30,832\n\n \n\n \n\n \n\n31,735\n\n \n\nLoss from operations\n\n \n\n \n\n(1,642\n\n)\n\n \n\n \n\n(10,596\n\n)\n\n \n\n \n\n(10,824\n\n)\n\nOther income (expense):\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nOther income\n\n \n\n \n\n51\n\n \n\n \n\n \n\n62\n\n \n\n \n\n \n\n39\n\n \n\nInterest expense\n\n \n\n \n\n(783\n\n)\n\n \n\n \n\n(1,026\n\n)\n\n \n\n \n\n(752\n\n)\n\nAmortization of debt issue costs\n\n \n\n \n\n(170\n\n)\n\n \n\n \n\n(206\n\n)\n\n \n\n \n\n(95\n\n)\n\nLoss on debt extinguishment\n\n \n\n \n\n(562\n\n)\n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\nInterest income\n\n \n\n \n\n3\n\n \n\n \n\n \n\n7\n\n \n\n \n\n \n\n2\n\n \n\nTotal other expense\n\n \n\n \n\n(1,461\n\n)\n\n \n\n \n\n(1,163\n\n)\n\n \n\n \n\n(806\n\n)\n\nLoss before income tax\n\n \n\n \n\n(3,103\n\n)\n\n \n\n \n\n(11,759\n\n)\n\n \n\n \n\n(11,630\n\n)\n\nIncome tax expense\n\n \n\n \n\n60\n\n \n\n \n\n \n\n42\n\n \n\n \n\n \n\n41\n\n \n\nNet loss\n\n \n\n$\n\n(3,163\n\n)\n\n \n\n$\n\n(11,801\n\n)\n\n \n\n$\n\n(11,671\n\n)\n\nBasic net loss per share attributable to common shareholders\n\n \n\n$\n\n(0.89\n\n)\n\n \n\n$\n\n(3.59\n\n)\n\n \n\n$\n\n(3.59\n\n)\n\nWeighted-average common shares outstanding\n\n \n\n \n\n3,560,671\n\n \n\n \n\n \n\n3,282,947\n\n \n\n \n\n \n\n3,248,624\n\n \n\nDiluted net loss per share\n\n \n\n$\n\n(0.89\n\n)\n\n \n\n$\n\n(3.59\n\n)\n\n \n\n$\n\n(3.59\n\n)\n\nWeighted-average common shares and share equivalents\n   outstanding\n\n \n\n \n\n3,560,671\n\n \n\n \n\n \n\n3,282,947\n\n \n\n \n\n \n\n3,248,624\n\n \n\nThe accompanying notes are an integral part of these Consolidated Financial Statements.\n\n \n\n46\n\n \n\nORION ENERGY SYSTEMS, INC. AND SUBSIDIARIES\n\nSTATEMENTS OF SHAREHOLDERS’ EQUITY\n\n \n\n \n\n \n\nShareholders’ Equity\n\n \n\n \n\n \n\nCommon Stock\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n(in thousands, except share amounts)\n\n \n\nShares\n\n \n\n \n\nAdditional\nPaid-in\nCapital\n\n \n\n \n\nTreasury\nStock\n\n \n\n \n\nAccumulated\nDeficit\n\n \n\n \n\nTotal\nShareholders’\nEquity\n\n \n\nBalance, March 31, 2023\n\n \n\n \n\n3,229,541\n\n \n\n \n\n$\n\n160,907\n\n \n\n \n\n$\n\n(36,237\n\n)\n\n \n\n$\n\n(91,421\n\n)\n\n \n\n$\n\n33,249\n\n \n\nIssuance of stock and shares for services\n\n \n\n \n\n1,132\n\n \n\n \n\n \n\n12\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n12\n\n \n\nShares issued under Employee Stock Purchase\n   Plan\n\n \n\n \n\n282\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n4\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n4\n\n \n\nStock-based compensation\n\n \n\n \n\n26,055\n\n \n\n \n\n \n\n950\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n950\n\n \n\nEmployee tax withholdings on stock-based\n   compensation\n\n \n\n \n\n(235\n\n)\n\n \n\n \n\n—\n\n \n\n \n\n \n\n(2\n\n)\n\n \n\n \n\n—\n\n \n\n \n\n \n\n(2\n\n)\n\nNet loss\n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n(11,671\n\n)\n\n \n\n \n\n(11,671\n\n)\n\nBalance, March 31, 2024\n\n \n\n \n\n3,256,775\n\n \n\n \n\n \n\n161,869\n\n \n\n \n\n \n\n(36,235\n\n)\n\n \n\n \n\n(103,092\n\n)\n\n \n\n \n\n22,542\n\n \n\nShares issued under Employee Stock Purchase\n   Plan\n\n \n\n \n\n193\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n2\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n2\n\n \n\nStock-based compensation\n\n \n\n \n\n43,126\n\n \n\n \n\n \n\n1,156\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n1,156\n\n \n\nEmployee tax withholdings on stock-based\n   compensation\n\n \n\n \n\n(1,705\n\n)\n\n \n\n \n\n—\n\n \n\n \n\n \n\n(15\n\n)\n\n \n\n \n\n—\n\n \n\n \n\n \n\n(15\n\n)\n\nNet loss\n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n(11,801\n\n)\n\n \n\n \n\n(11,801\n\n)\n\nBalance, March 31, 2025\n\n \n\n \n\n3,298,389\n\n \n\n \n\n \n\n163,025\n\n \n\n \n\n \n\n(36,248\n\n)\n\n \n\n \n\n(114,893\n\n)\n\n \n\n \n\n11,884\n\n \n\nPublic stock offering, net of issuance costs\n\n \n\n \n\n500,000\n\n \n\n \n\n \n\n6,138\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n6,138\n\n \n\nIssuance of stock for earnout payment\n\n \n\n \n\n164,908\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n1,000\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n1,000\n\n \n\nIssuance of stock for sign on bonus\n\n \n\n \n\n21,166\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n300\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n300\n\n \n\nShares issued under Employee Stock Purchase\n   Plan\n\n \n\n \n\n75\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n1\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n1\n\n \n\nStock-based compensation\n\n \n\n \n\n73,336\n\n \n\n \n\n \n\n483\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n483\n\n \n\nEmployee tax withholdings on stock-based\n   compensation\n\n \n\n \n\n(1,346\n\n)\n\n \n\n \n\n—\n\n \n\n \n\n \n\n(15\n\n)\n\n \n\n \n\n—\n\n \n\n \n\n \n\n(15\n\n)\n\nNet loss\n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n(3,163\n\n)\n\n \n\n \n\n(3,163\n\n)\n\nBalance, March 31, 2026\n\n \n\n \n\n4,056,528\n\n \n\n \n\n$\n\n169,646\n\n \n\n \n\n$\n\n(34,962\n\n)\n\n \n\n$\n\n(118,056\n\n)\n\n \n\n$\n\n16,628\n\n \n\nThe accompanying notes are an integral part of these Consolidated Financial Statements.\n\n \n\n47\n\n \n\nORION ENERGY SYSTEMS, INC. AND SUBSIDIARIES\n\nCONSOLIDATED STATEMENTS OF CASH FLOWS\n\n \n\n \n\nFiscal Year Ended March 31,\n\n \n\n(in thousands)\n\n \n\n2026\n\n \n\n \n\n2025\n\n \n\n \n\n2024\n\n \n\nOperating activities\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nNet loss\n\n \n\n$\n\n(3,163\n\n)\n\n \n\n$\n\n(11,801\n\n)\n\n \n\n$\n\n(11,671\n\n)\n\nAdjustments to reconcile net loss to net cash (used in) provided by\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\noperating activities:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nDepreciation and amortization\n\n \n\n \n\n1,784\n\n \n\n \n\n \n\n2,619\n\n \n\n \n\n \n\n2,590\n\n \n\nStock-based compensation\n\n \n\n \n\n483\n\n \n\n \n\n \n\n1,157\n\n \n\n \n\n \n\n950\n\n \n\nLoss on debt extinguishment\n\n \n\n \n\n562\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\nDeferred taxes and impairment of property and equipment\n\n \n\n \n\n5\n\n \n\n \n\n \n\n27\n\n \n\n \n\n \n\n64\n\n \n\nLoss on asset disposals\n\n \n\n \n\n1,118\n\n \n\n \n\n \n\n91\n\n \n\n \n\n \n\n84\n\n \n\nProvision for inventory reserves\n\n \n\n \n\n461\n\n \n\n \n\n \n\n552\n\n \n\n \n\n \n\n562\n\n \n\nProvision for credit losses\n\n \n\n \n\n12\n\n \n\n \n\n \n\n378\n\n \n\n \n\n \n\n170\n\n \n\nOther\n\n \n\n \n\n(6\n\n)\n\n \n\n \n\n197\n\n \n\n \n\n \n\n468\n\n \n\nChanges in operating assets and liabilities:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nAccounts receivable\n\n \n\n \n\n(3,507\n\n)\n\n \n\n \n\n800\n\n \n\n \n\n \n\n(464\n\n)\n\nRevenue earned but not billed\n\n \n\n \n\n(3,059\n\n)\n\n \n\n \n\n1,189\n\n \n\n \n\n \n\n(3,219\n\n)\n\nInventories\n\n \n\n \n\n627\n\n \n\n \n\n \n\n6,106\n\n \n\n \n\n \n\n(603\n\n)\n\nPrepaid expenses and other assets\n\n \n\n \n\n802\n\n \n\n \n\n \n\n2,324\n\n \n\n \n\n \n\n(1,384\n\n)\n\nAccounts payable\n\n \n\n \n\n2,179\n\n \n\n \n\n \n\n(5,078\n\n)\n\n \n\n \n\n4,990\n\n \n\nAccrued expenses and other liabilities\n\n \n\n \n\n1,296\n\n \n\n \n\n \n\n1,883\n\n \n\n \n\n \n\n(2,334\n\n)\n\nDeferred revenue, current and long-term\n\n \n\n \n\n(673\n\n)\n\n \n\n \n\n155\n\n \n\n \n\n \n\n(295\n\n)\n\nNet cash provided by (used in) operating activities\n\n \n\n \n\n(1,079\n\n)\n\n \n\n \n\n599\n\n \n\n \n\n \n\n(10,092\n\n)\n\nInvesting activities\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nPurchase of property and equipment\n\n \n\n \n\n(83\n\n)\n\n \n\n \n\n(99\n\n)\n\n \n\n \n\n(837\n\n)\n\nAdditions to patents and licenses\n\n \n\n \n\n(3\n\n)\n\n \n\n \n\n(6\n\n)\n\n \n\n \n\n—\n\n \n\nProceeds from sales of property and equipment\n\n \n\n \n\n—\n\n \n\n \n\n \n\n233\n\n \n\n \n\n \n\n106\n\n \n\nNet cash provided by (used in) investing activities\n\n \n\n \n\n(86\n\n)\n\n \n\n \n\n128\n\n \n\n \n\n \n\n(731\n\n)\n\nFinancing activities\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nPayment of long-term debt\n\n \n\n \n\n(3,403\n\n)\n\n \n\n \n\n(206\n\n)\n\n \n\n \n\n(15\n\n)\n\nProceeds from revolving credit facility\n\n \n\n \n\n4,250\n\n \n\n \n\n \n\n500\n\n \n\n \n\n \n\n—\n\n \n\nPayment of revolving credit facility\n\n \n\n \n\n(8,250\n\n)\n\n \n\n \n\n(3,500\n\n)\n\n \n\n \n\n—\n\n \n\nProceeds from long-term debt\n\n \n\n \n\n—\n\n \n\n \n\n \n\n3,525\n\n \n\n \n\n \n\n—\n\n \n\nUnamortized debt issuance cost write-off\n\n \n\n \n\n(180\n\n)\n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\nIssuance of treasury stock\n\n \n\n \n\n300\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\nProceeds from public stock offering, net of issuance costs\n\n \n\n \n\n6,138\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\nPayments to settle employee tax withholdings on stock-based\n compensation\n\n \n\n \n\n(11\n\n)\n\n \n\n \n\n—\n\n \n\n \n\n \n\n(2\n\n)\n\nDebt issue costs\n\n \n\n \n\n(383\n\n)\n\n \n\n \n\n(216\n\n)\n\n \n\n \n\n—\n\n \n\nProceeds from employee equity exercises\n\n \n\n \n\n(3\n\n)\n\n \n\n \n\n(13\n\n)\n\n \n\n \n\n3\n\n \n\nNet cash provided by (used in) financing activities\n\n \n\n \n\n(1,542\n\n)\n\n \n\n \n\n90\n\n \n\n \n\n \n\n(14\n\n)\n\nNet increase (decrease) in cash and cash equivalents\n\n \n\n \n\n(2,707\n\n)\n\n \n\n \n\n817\n\n \n\n \n\n \n\n(10,837\n\n)\n\nCash and cash equivalents at beginning of period\n\n \n\n \n\n5,972\n\n \n\n \n\n \n\n5,155\n\n \n\n \n\n \n\n15,992\n\n \n\nCash and cash equivalents at end of period\n\n \n\n$\n\n3,265\n\n \n\n \n\n$\n\n5,972\n\n \n\n \n\n$\n\n5,155\n\n \n\nSupplemental cash flow information:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCash paid for interest\n\n \n\n$\n\n(758\n\n)\n\n \n\n$\n\n(962\n\n)\n\n \n\n$\n\n(691\n\n)\n\nCash paid for income taxes\n\n \n\n$\n\n(36\n\n)\n\n \n\n$\n\n(26\n\n)\n\n \n\n$\n\n(59\n\n)\n\nSupplemental disclosure of non-cash investing and financing activities:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nOperating lease assets obtained in exchange for new operating lease liabilities\n\n \n\n$\n\n—\n\n \n\n \n\n$\n\n2,661\n\n \n\n \n\n$\n\n—\n\n \n\nIssuance of common stock to Final Frontier, LLC as partial payment of earnout obligation\n\n \n\n$\n\n1,000\n\n \n\n \n\n$\n\n—\n\n \n\n \n\n$\n\n—\n\n \n\nIssuance of subordinated debt for earnout obligation\n\n \n\n$\n\n3,051\n\n \n\n \n\n$\n\n—\n\n \n\n \n\n$\n\n—\n\n \n\nThe accompanying notes are an integral part of these Consolidated Financial Statements.\n\n48\n\n \n\n \n\nORION ENERGY SYSTEMS, INC. AND SUBSIDIARIES\n\nNOTES TO CONSOLIDATED FINANCIAL STATEMENTS\n\nNOTE 1 — DESCRIPTION OF BUSINESS\n\nOrion includes Orion Energy Systems, Inc., a Wisconsin corporation, and all consolidated subsidiaries. Orion provides light emitting diode lighting systems, wireless Internet of Things enabled control solutions, project engineering, energy project management design, maintenance services and turnkey electric vehicle charging stations and related installation services to commercial and industrial businesses, and federal and local governments, predominantly in North America.\n\nOrion’s corporate offices and leased primary manufacturing operations are located in Manitowoc, Wisconsin. Orion also leases office space in Jacksonville, Florida and Lawrence, Massachusetts.\n\nNOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES\n\nPrinciples of Consolidation\n\nThe consolidated financial statements include the accounts of Orion Energy Systems, Inc. and its wholly-owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation.\n\nUse of Estimates\n\nThe preparation of financial statements in conformity with Generally Accepted Accounting Principles (GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during that reporting period. Areas that require the use of management estimates include revenue recognition, net realizable value of inventory, allowance for credit losses, accruals for warranty and loss contingencies, earnout, income taxes, impairment analyses, and certain equity transactions. Accordingly, actual results could differ from those estimates.\n\nCash and Cash Equivalents\n\nOrion considers all highly liquid, short-term investments with original maturities of three months or less to be cash equivalents.\n\nFair Value of Financial Instruments\n\nOrion’s financial instruments consist of cash and cash equivalents, accounts receivable, accounts payable, accrued expenses and other, revolving credit facility and debt. In addition, other long-term assets, net includes an equity investment of $0.5 million that is carried at cost less impairment, of which there has been no impairment as of March 31, 2026, 2025, and 2024. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. GAAP describes a fair value hierarchy based on the following three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value:\n\nLevel 1 — Valuations are based on unadjusted quoted prices in active markets for identical assets or liabilities.\n\nLevel 2 — Valuations are based on quoted prices for similar assets or liabilities in active markets, or quoted prices in markets that are not active for which significant inputs are observable, either directly or indirectly.\n\nLevel 3 — Valuations are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. Inputs reflect management's best estimate of what market participants would use in valuing the asset or liability at the measurement date.\n\n49\n\n \n\nThe carrying amounts of Orion’s financial instruments and debt approximate their respective fair values due to the relatively short-term nature of these instruments. Orion's debt is considered Level 2 and is reflected in the consolidated balance sheets at carrying value, which approximate fair value because the stated interest rates are similar to interest rates currently available to Orion for similar obligations.\n\nAllowance for Credit Losses\n\nOrion performs ongoing evaluations of its customers and continuously monitors collections and payments. Orion estimates an allowance for credit losses based upon the historical collectability based on past due status and makes judgments about the creditworthiness of customers based on ongoing credit evaluations. Orion also considers customer-specific information, current market conditions, and reasonable and supportable forecasts of future economic conditions.\n\nInventories, Net\n\nInventories consist of raw materials and components, such as drivers, metal sheet and coil stock and molded parts; work in process inventories, such as frames and reflectors; and finished goods, including completed fixtures and systems, and accessories. All inventories are stated at the lower of cost or net realizable value with cost determined using the first-in, first-out (FIFO) method. In determining the lower of cost or net realizable value, we consider assumptions such as business and economic conditions, expected demand for our products, changes in technology or customer requirements, recent historical sales activity (including usage in the preceding 9 to 12 months) and selling prices, as well as estimates of future selling prices. When the net realizable value of inventories exceeds the carrying value, Orion records, as a charge to Cost of product revenue, the amount required to reduce the carrying value of inventory to net realizable value.\n\nIncentive Plan\n\nOrion’s human capital management and compensation committee annually approves an executive annual cash incentive program. Based upon the results for the fiscal years ended March 31, 2026, 2025, and 2024, Orion accrued approximately $1.0 million, $0.1 million and $0.2 million expense related to these programs, respectively.\n\nRevenue Recognition\n\nOrion generates revenues primarily by selling commercial lighting fixtures and components, installing these fixtures in its customers' facilities, and providing maintenance services including repairs and replacements for the lighting and related electrical components deployed in its customer’s facilities. Orion recognizes revenue in accordance with the guidance in “Revenue from Contracts with Customers” (Topic 606) (ASC 606) when control of the goods or services being provided (which Orion refers to as a performance obligation) is transferred to a customer at an amount that reflects the consideration that management expects to receive in exchange for those goods or services. Prices are generally fixed at the time of order confirmation, either for the contract as a whole or for the hourly rates that will be charged for the type of maintenance services delivered.\n\nIf there are multiple performance obligations in a single contract, the contract’s total transaction price is allocated to each individual performance obligation based on their relative standalone selling price. A performance obligation’s standalone selling price is the price at which Orion would sell such promised good or service separately to a customer. Orion uses an observable price to determine the stand-alone selling price for separate performance obligations or an expected cost-plus margin approach when one is not available. When the expected cost-plus margin approach is used to determine the estimated stand-alone selling price it is based on average historical margins for that performance obligation in contracts with similar customers.\n\nRevenue derived from customer contracts which include only performance obligation(s) for the sale of Orion manufactured or sourced lighting fixtures and components is classified as Product revenue in the consolidated statements of operations. The revenue for these transactions is recorded at the point in time when management believes that the customer obtains control of the products, generally either upon shipment or upon delivery to the customer’s facility. This point in time is determined separately for each contract and requires judgment by management of the contract terms and the specific facts and circumstances concerning the transaction.\n\n50\n\n \n\nRevenue from a customer contract, which includes both the sale of Orion manufactured or sourced fixtures and the installation of such fixtures (which Orion refers to as a turnkey project), is allocated between each lighting fixture and the installation performance obligation based on relative standalone selling prices.\n\nRevenue from turnkey projects that is allocated to the sale of the lighting fixtures is recorded at the point in time when management believes the customer obtains control of the product(s) and is reflected in Product revenue. This point in time is determined separately for each customer contract based upon the terms of the contract and the nature and extent of Orion’s control of the light fixtures during the installation. Product revenue associated with turnkey projects can be recorded (a) upon shipment or delivery, (b) subsequent to shipment or delivery and upon customer payments for the light fixtures, (c) when an individual light fixture is installed and working correctly, or (d) when the customer acknowledges that the entire installation project is substantially complete. Determining the point in time when a customer obtains control of the lighting fixtures in a turnkey project is applied separately for each individual light fixture included in a contract. In making this judgment, management considers the timing of various factors, including, but not limited to, those detailed below:\n\n \n\n•\nwhen there is a legal transfer of ownership;\n\n•\nwhen the customer obtains physical possession of the products;\n\n•\nwhen the customer starts to receive the benefit of the products;\n\n•\nthe amount and duration of physical control that Orion maintains on the products after they are shipped to, and received at, the customer’s facility;\n\n•\nwhether Orion is required to maintain insurance on the lighting fixtures when they are in transit and after they are delivered to the customer’s facility;\n\n•\nwhen each light fixture is physically installed and working correctly;\n\n•\nwhen the customer formally accepts the product; and\n\n•\nwhen Orion receives payment from the customer for the light fixtures.\n\nRevenue from turnkey projects that is allocated to the single installation performance obligation is reflected in Service revenue. Service revenue is recorded over-time as Orion fulfills its obligation to install the light fixtures. Orion measures its performance toward fulfilling its performance obligations for installations using an output method that calculates the number of light fixtures removed and installed as of the measurement date in comparison to the total number of light fixtures to be removed and installed under the contract.\n\nRevenue from the maintenance offering that includes both the sale of Orion manufactured or sourced product and service is allocated between the product and service performance obligations based on relative standalone selling prices using the cost-plus margin approach, and is recorded in Product revenue and Service revenue, respectively, in the consolidated statement of operations.\n\nOrion offers a financing program, called an Orion Throughput Agreement, or OTA, for a customer’s lease of Orion’s energy management systems. The OTA is structured as a sales-type lease and upon successful installation of the system and customer acknowledgment that the system is operating as specified, revenue is recognized at Orion’s net investment in the lease, which typically is the net present value of the future cash flows.\n\nOrion also records revenue in conjunction with limited power purchase agreements (“PPAs”) still outstanding. Those PPAs are supply-side agreements for the generation of electricity. Orion’s last PPA expires in 2031. Revenue associated with the sale of energy generated by the solar facilities under these PPAs is within the scope of ASC 606. Revenues are recognized over-time and are equal to the amount billed to the customer, which is calculated by applying the fixed rate designated in the PPAs to the variable amount of electricity generated each month. This approach is in accordance with the “right to invoice” practical expedient provided for in ASC 606. Orion also recognizes revenue upon the sale to third parties of tax credits received from operating the solar facilities and from amortizing a grant received from the federal government during the period starting when the power generating facilities were constructed until the expiration of the PPAs; these revenues are not derived from contracts with customers and therefore not under the scope of ASC\n\n51\n\n \n\n606. In March 2026, Orion executed a contract modification for its two remaining PPAs that immediately terminated the agreements and eliminated any remaining obligations with respect to those agreements. Orion recognized the $1.3 million payment received as a contract modification in accordance with ASC 606 in the period of termination.\n\nDuring the third quarter of fiscal 2023, Orion acquired Voltrek LLC (\"Voltrek\"), which sells and installs sourced electric vehicle charging stations and related software subscriptions and renewals. The results of Voltrek are included in the EV segment and compliment Orion’s existing turnkey installation model.\n\nThe sale of charging stations and related software subscriptions, renewals and extended warranty is presented in Product revenue. Orion is the principal in the sales of charging stations as it has control of the physical products prior to transfer to the customer. Accordingly, revenue is recognized on a gross basis. For certain sales, primarily software subscriptions, renewals and extended warranty, Orion is the sales agent providing access to the content and recognize commission revenue net of amounts due to third parties who fulfill the performance obligation. For these sales, control passes at the point in time upon providing access of the content to the customer.\n\nThe sale of installation and services related to the EV charging business is presented in Service revenue. Revenue from the EV segment that includes both the sale of product and service is allocated between the product and service performance obligations based on relative standalone selling prices using the cost-plus margin approach, and is recorded in Product revenue and Service revenue, respectively, in the consolidated statement of operations.\n\nFrom time to time, the EV segment enters into bill and hold arrangements, whereby the Company sells EV charging stations and the charging stations are warehoused at a Company location for a specified period of time in accordance with directions received from the Company's customers. Even though the charging stations are held at a Company location, a sale is recognized at the point in time when the customer obtains control of the product. Control is transferred to the customer in a bill and hold arrangement when: customer acceptance specifications have been met, legal title has transferred, the customer has a present obligation to pay for the product and the risk and rewards of ownership have transferred to the customer. Additionally, all the following bill and hold criteria have been met in order for control to be transferred to the customer: the reason for the bill and hold arrangement is substantive -the customer has requested the product be warehoused, the product has been identified as separately belonging to the customer, the product is currently ready for physical transfer to the customer, and the Company does not have the ability to use the product or direct it to another customer.\n\nSee Note 10 – Accrued Expenses and Other for a discussion of Orion’s accounting for the limited warranty it provides to customers for its products and services.\n\nSales taxes collected from customers and remitted to governmental authorities are accounted for on a net (excluded from revenues) basis.\n\nContract Fulfillment Costs\n\nCosts associated with product sales are accumulated in inventory as the fixtures are manufactured and are transferred to Cost of product revenue at the time revenue is recorded. See Note 5 – Inventories. Costs associated with installation sales are expensed as incurred.\n\nPractical Expedients and Exemptions\n\nOrion expenses sales commissions when incurred because the amortization period is one year or less. These costs are recorded within Sales and marketing expense. There are no other capitalizable costs associated with obtaining contracts with customers.\n\nOrion’s performance obligations related to lighting fixtures and EV charging stations typically do not exceed nine months in duration. As a result, Orion has elected the practical expedient that provides an exemption to the disclosure requirements regarding information about value assigned to remaining performance obligations on contracts that have original expected durations of one year or less.\n\n52\n\n \n\nOrion also elected the practical expedient that permits companies to not disclose quantitative information about the future revenue when revenue is recognized as invoices are issued to customers for services performed.\n\nOther than the turnkey projects which result in sales-type leases discussed above, Orion generally receives full payment for satisfied performance obligations in less than one year. Accordingly, Orion does not adjust revenues for the impact of any potential significant financing component as permitted by the practical expedients provided in ASC 606.\n\nShipping and Handling Costs\n\nOrion records costs incurred in connection with shipping and handling of products as Cost of product revenue. Amounts billed to customers in connection with these costs are included in product revenue.\n\nResearch and Development\n\nOrion expenses research and development costs as incurred. Amounts are included in the consolidated statement of operations on the line item Research and development.\n\nLeases\n\nFrom time to time, Orion leases assets from third parties. Orion also leases certain assets to third parties. Leases are accounted for, and reported upon, following the requirements of ASC 842.\n\nWhether it is the lessee or the lessor, Orion’s determination of whether a contract includes a lease, and assessing how the lease should be accounted for, is a matter of judgment based on whether the risks and rewards, as well as substantive control of the assets specified in the contract, have been transferred from the lessor to the lessee. The judgment considers matters such as whether the assets are transferred from the lessor to the lessee at the end of the contract, the term of the agreement in relation to the asset’s remaining economic useful life, and whether the assets are of such a specialized nature that the lessor will not have an alternative use for such assets at the termination of the agreement. Other matters requiring judgment are the lease term when the agreement includes renewal or termination options and the interest rate used when initially determining the Right-of-Use (ROU) asset and lease liability.\n\nROU assets represent Orion’s right to use an underlying asset for the lease term and lease liabilities represent Orion’s obligation to make lease payments arising from the lease. Under ASC 842, both finance and operating lease ROU assets and lease liabilities for leases with initial terms in excess of 12 months are recognized at the commencement date based on the present value of lease payments over the lease term. When available, Orion uses the implicit interest rate in the lease when completing this calculation. However, as most of Orion’s operating lease agreements generating ROU assets do not provide the implicit rate, Orion’s incremental borrowing rate under its Credit Facility, adjusted for differences in duration and the relative collateral value in relation to the payment obligation, at the commencement of the lease is generally used in this calculation. The lease term includes options to extend or renew the agreement, or for early termination of the agreement, when it is reasonably certain that Orion will exercise such option. ROU assets are depreciated using the straight-line method over the lease term.\n\nOrion recognizes lease expense for leases with an initial term of 12 months or less, referred to as short term leases, on a straight-line basis over the lease term.\n\nIntangible Assets\n\nIntangible assets that have a definite life are evaluated for potential impairment whenever events or circumstances indicate that the carrying value may not be recoverable based primarily upon whether expected future undiscounted cash flows are sufficient to support the asset recovery. If the actual useful life of the asset is shorter than the estimated life, the asset may be deemed to be impaired and accordingly a write-down of the value of the asset determined by a discounted cash flow analysis or shorter amortization period may be required.\n\n53\n\n \n\nIndefinite lived intangible assets and goodwill are evaluated for impairment at least annually on the first day of Orion’s fiscal fourth quarter, or when indications of potential impairment exist. This annual impairment review may begin with a qualitative test to determine whether it is more likely than not that an indefinite lived intangible asset's carrying value is greater than its fair value. If the qualitative assessment reveals that asset impairment is more likely than not, a quantitative impairment test is performed comparing the fair value of the indefinite lived intangible asset to its carrying value. Alternatively, the qualitative test may be bypassed and the quantitative impairment test may be immediately performed. If the fair value of the indefinite lived intangible asset exceeds its carrying value, the indefinite lived intangible asset is not impaired and no further review is performed. If the carrying value of the indefinite lived intangible asset exceeds its fair value, an impairment loss would be recognized in an amount equal to such excess. Once an impairment loss is recognized, the adjusted carrying value becomes the new accounting basis of the indefinite lived intangible asset.\n\nIncome Taxes\n\nOrion recognizes deferred tax assets and liabilities for the future tax consequences of temporary differences between financial reporting and income tax basis of assets and liabilities, measured using the enacted tax rates and laws expected to be in effect when the temporary differences reverse. Deferred income taxes also arise from the future tax benefits of operating loss and tax credit carryforwards. A valuation allowance is established when management determines that it is more likely than not that all or a portion of a deferred tax asset will not be realized.\n\nASC 740, Income Taxes, also prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination. Orion has classified the amounts recorded for uncertain tax benefits in the balance sheet as other liabilities (non-current) to the extent that payment is not anticipated within one year. Orion recognizes penalties and interest related to uncertain tax liabilities in income tax expense.\n\nStock-based Compensation\n\nOrion accounts for stock-based compensation in accordance with ASC 718, Compensation - Stock Compensation. Under the fair value recognition provisions of ASC 718, stock-based compensation is measured at the grant date based on the fair value of the award and is recognized as expense ratably over the requisite service period. As more fully described in Note 16 – Restricted Shares, Orion currently awards non-vested restricted stock (and in some cases, in conjunction with associated cash award accounted for as a liability) to employees, executive officers and directors.\n\nConcentration of Credit Risk and Other Risks and Uncertainties\n\nOrion’s cash is primarily deposited with one financial institution. At times, deposits in these institutions exceed the amount of insurance provided on such deposits. Orion has not experienced any losses in such accounts and believes that it is not exposed to any significant financial institution viability risk on these balances.\n\nOrion purchases components necessary for its lighting products, including lamps and LED components, from multiple suppliers. For fiscal 2026, 2025 and 2024, no supplier accounted for more than 10% of total cost of revenue.\n\nIn fiscal 2026, one customer accounted for 26.0% of revenue. In fiscal 2025, one customer accounted for 18.1% of total revenue. In fiscal 2024, one customer accounted for 25.6% of total revenue. The revenue from this customer is recorded in Orion's lighting and maintenance segments.\n\nAs of March 31, 2026, one customer accounted for 33.1% of accounts receivable. As of March 31, 2025, one customer accounted for 13.0% of accounts receivable.\n\nCompliance with the Continued Listing Standards of the Nasdaq Capital Market (“NASDAQ”) and Reverse Stock Split\n\n54\n\n \n\nAs previously disclosed, on September 20, 2024, Orion received written notice from the Listing Qualifications Department (the “Staff”) of NASDAQ notifying Orion that it was not in compliance with the minimum bid price requirements set forth in Nasdaq Listing Rule 5550(a)(2) (the “Minimum Bid Price Rule”) for continued listing on NASDAQ, as the closing bid price of the Orion’s common stock had been below $1.00 per share for 30 consecutive trading days.\n\nUltimately, in order to regain compliance with the Minimum Bid Price Rule, Orion effected a 1-for-10 reverse stock split of its common stock as of the opening of trading on August 22, 2025.\n\nAs a result of the effect of Orion's reverse stock split, on September 8, 2025, Orion received a written notification from the Staff indicating that Orion had regained compliance with the Minimum Bid Price Rule. Consequently, Orion is now in compliance with all applicable listing standards of, and remains listed on, the NASDAQ.\n\nRecent Accounting Pronouncements\n\nChanges to GAAP are typically established by the Financial Accounting Standards Board (“FASB”) in the form of accounting standards updates (“ASUs”) to the FASB’s ASC. Orion considers the applicability and impact of all ASUs.\n\nRecently Adopted Standards\n\nIn December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which expands disclosures in an entity's income tax rate reconciliation table and disclosures regarding cash taxes paid both in the U.S. and foreign jurisdictions. The update will be effective for annual periods beginning after December 15, 2025. Orion adopted this standard on March 31, 2026, and it did not have a material effect on its results of operations, financial position, or cash flows. For additional information, see Note 13.\n\nIssued: Not Yet Adopted\n\nIn December 2025, the FASB issued ASU No. 2025-11, Interim Reporting, which is intended to improve the navigability of the guidance in Accounting Standards Codification (ASC) 270 and clarify when it applies. Under the amendments, an entity is subject to ASC 270 if it provides \"interim financial statements and notes in accordance with GAAP.\" The ASU also addresses the form and content of such financial statements, adds lists to ASC 270 of the interim disclosures required by all other codification topics, and establishes a principle under which an entity must \"disclose events since the end of the last annual reporting period that have a material impact on the entity.\" As the FASB stated in the proposed guidance and reiterates in the ASU, the amendments are not intended to \"change the fundamental nature of interim reporting or expand or reduce current interim disclosure requirements.\" The amendments will be effective for interim reporting periods within annual reporting periods beginning after December 15, 2027. Orion is currently evaluating the impact that this guidance will have on the presentation of its consolidated financial statements and accompanying notes.\n\nIn July 2025, the FASB issued ASU No. 2025-05, Financial Instruments - Credit Losses (Topic 326), which modifies the current credit loss guidance in Topic 326 to expand on how an entity develops and estimate of expected credit losses. The amendments in this update provide (1) all entities with a practical expedient and (2) entities other than public business entities with an accounting policy election when estimating expected credit loses for current accounts receivable and current contract assets arising from transactions accounted for under ASC 606, as follows: \"1. Practical expedient. In developing reasonable and supportable forecasts as part of estimating expected credit losses, all entities may elect a practical expedient that assumes that current conditions as of the balance sheet date do not change for the remaining life of the asset. 2. Accounting policy election. An entity other than a public business entity that elects the practical expedient is permitted to make an accounting policy election to consider collection activity after the balance sheet date when estimating expected credit losses.\" The amendments will be effective for annual reporting periods beginning after December 15, 2025, and interim reporting periods within those annual reporting periods. Early adoption is permitted in both interim and annual reporting periods in which financial statements have not yet been issued or made available for issuance. Orion is currently evaluating the impact that this guidance will have on the presentation of its consolidated financial statements and accompanying notes.\n\n55\n\n \n\nIn November 2024, the FASB issued ASU No. 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40), which modifies the disclosure and presentation requirements relating to expenses shown on the statements of operations. The amendments in the update require disclosure, in the notes to financial statements, of specified information about certain costs and expenses. The amendments require that at each interim and annual reporting period an entity: \"1. Disclose the amounts of (a) purchases of inventory, (b) employee compensation, (c) depreciation, (d) intangible asset amortization, and (e) depreciation, depletion, and amortization recognized as part of oil and gas-producing activities. 2. Include certain amounts that are already required to be disclosed under current generally accepted accounting principles in the same disclosure as the other disaggregation requirements. 3. Disclose a qualitative description of the amounts remaining in relevant expense captions that are not separately disaggregated quantitatively. 4. Disclose the total amount of selling expense and, in annual reporting periods, an entity's definition of selling expenses.\" The amendments in this update are effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted. Orion is currently evaluating the impact that this guidance will have on the presentation of its consolidated financial statements and accompanying notes.\n\nNOTE 3 — REVENUE\n\n \n\nDisaggregation of Revenue\n\nThe primary end-users of Orion’s lighting products and services are (a) the federal government, and (b) commercial or industrial companies.\n\nThe federal government obtains Orion products and services primarily through turnkey project sales that Orion makes to a select group of contractors who focus on the federal government. Revenues associated with government end-users are primarily included in the Orion lighting and EV segments.\n\nCommercial or industrial end-users obtain Orion products and services through turnkey project sales or by purchasing products either direct from Orion or through distributors or energy service companies (\"ESCOs\"). Revenues associated with commercial and industrial end-users are included within each of Orion’s segments.\n\nSee Note 17 - Segment Data, for additional discussion concerning Orion’s reportable segments.\n\nThe following table provides detail of Orion’s total revenues for the year ended March 31, 2026, 2025, and 2024 (dollars in thousands):\n\n \n\n \n\n \n\nYear Ended March 31, 2026\n\n \n\n \n\nYear Ended March 31, 2025\n\n \n\n \n\nYear Ended March 31, 2024\n\n \n\n \n\n \n\nProduct\n\n \n\n \n\nServices\n\n \n\n \n\nTotal\n\n \n\n \n\nProduct\n\n \n\n \n\nServices\n\n \n\n \n\nTotal\n\n \n\n \n\nProduct\n\n \n\n \n\nServices\n\n \n\n \n\nTotal\n\n \n\nRevenue from contracts with customers:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nLighting product and installation\n\n \n\n$\n\n38,995\n\n \n\n \n\n$\n\n14,707\n\n \n\n \n\n$\n\n53,702\n\n \n\n \n\n$\n\n39,247\n\n \n\n \n\n$\n\n7,659\n\n \n\n \n\n$\n\n46,906\n\n \n\n \n\n$\n\n50,229\n\n \n\n \n\n$\n\n10,783\n\n \n\n \n\n$\n\n61,012\n\n \n\nMaintenance services\n\n \n\n \n\n7,293\n\n \n\n \n\n \n\n8,749\n\n \n\n \n\n \n\n16,042\n\n \n\n \n\n \n\n5,902\n\n \n\n \n\n \n\n9,288\n\n \n\n \n\n \n\n15,190\n\n \n\n \n\n \n\n4,687\n\n \n\n \n\n \n\n12,460\n\n \n\n \n\n \n\n17,147\n\n \n\nElectric vehicle charging\n\n \n\n \n\n8,563\n\n \n\n \n\n \n\n5,821\n\n \n\n \n\n \n\n14,384\n\n \n\n \n\n \n\n8,421\n\n \n\n \n\n \n\n8,405\n\n \n\n \n\n \n\n16,826\n\n \n\n \n\n \n\n8,301\n\n \n\n \n\n \n\n4,031\n\n \n\n \n\n \n\n12,332\n\n \n\nSolar energy-related revenues\n\n \n\n \n\n1,353\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n1,353\n\n \n\n \n\n \n\n17\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n17\n\n \n\n \n\n \n\n28\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n28\n\n \n\nTotal revenues from contracts with customers\n\n \n\n \n\n56,204\n\n \n\n \n\n \n\n29,277\n\n \n\n \n\n \n\n85,481\n\n \n\n \n\n \n\n53,587\n\n \n\n \n\n \n\n25,352\n\n \n\n \n\n \n\n78,939\n\n \n\n \n\n \n\n63,245\n\n \n\n \n\n \n\n27,274\n\n \n\n \n\n \n\n90,519\n\n \n\nRevenue accounted for under other guidance (1)\n\n \n\n \n\n825\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n825\n\n \n\n \n\n \n\n781\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n781\n\n \n\n \n\n \n\n62\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n62\n\n \n\nTotal revenue\n\n \n\n$\n\n57,029\n\n \n\n \n\n$\n\n29,277\n\n \n\n \n\n$\n\n86,306\n\n \n\n \n\n$\n\n54,368\n\n \n\n \n\n$\n\n25,352\n\n \n\n \n\n$\n\n79,720\n\n \n\n \n\n$\n\n63,307\n\n \n\n \n\n$\n\n27,274\n\n \n\n \n\n$\n\n90,581\n\n \n\n \n\n(1) Revenue accounted for under other guidance is recognized as Product revenue in the consolidated statements of operations and includes $0.4 million, $0.7 million and $0 million derived from sales-type leases for light fixtures for the fiscal years ended March 31, 2026, 2025, and 2024, respectively; $0 million, $0 million, and $0.1 million derived from the sale of tax credits generated from Orion’s legacy operation for distributing solar energy for the fiscal years ended March 31, 2026, 2025, and 2024, respectively; and $0.4 million, $0, and $0 derived from the amortization of federal grants received in 2010 and 2011 as reimbursement for a portion of the costs to construct the legacy solar facilities for the fiscal years ended March 31, 2026, 2025, and 2024, respectively.\n\nBill and hold revenue that had not shipped was $0 million and $0.1 million as of March 31, 2026 and 2025, respectively.\n\n56\n\n \n\nCash Flow Considerations\n\nMaterial only orders are short-term in nature generally having terms of significantly less than one year. We record revenue from these contracts when the customer obtains control of those goods, which is generally consistent with the payment due date. There is not a significant impact on the nature, amount, timing, and uncertainty of revenue or cash flows based on when control transfers.\n\nTurnkey projects and repair services provided to commercial or industrial companies typically span between one week to three months. Customer payment requirements for these projects vary by contract. Some contracts provide for customer payments for products and services as they are delivered, other contracts specify that the customer will pay for the project in its entirety upon completion of the installation.\n\nTurnkey projects where the end-user is the federal government typically span a three to six-month period. The contracts for these sales often provide for monthly progress payments equal to ninety percent (90%) of the value provided by Orion during the month.\n\nOrion provides long-term financing to one customer who frequently engages Orion in large turnkey projects that span between three and nine months. The customer executes an agreement providing for monthly payments of the contract price, plus interest, over a five-year period. The total transaction price in these contracts is allocated between product and services in the same manner as all other turnkey projects. The portion of the transaction associated with the installation is accounted for consistently with all other installation related performance obligations. The portion of the transaction associated with the sale of the multiple individual light fixtures is accounted for as sales-type leases in accordance with the guidance for leases. Revenues associated with the sales-type leases are included in Product revenue and recorded for each fixture separately based on the customer’s monthly acknowledgment that specified fixtures have been installed and are operating as specified.\n\nThe payments associated with these transactions that are due during the twelve months subsequent to March 31, 2026 are included in Accounts receivable, net in Orion’s consolidated balance sheets. The remaining amounts due that are associated with these transactions are included in Long-term accounts receivable in Orion’s consolidated balance sheets. As of March 31, 2026 and 2025, there were no such transactions included in Long-term accounts receivable.\n\nThe customer’s monthly payment obligation commences after completion of the turnkey project. Orion generally sells the receivable from the customer to a financial institution either during, or shortly after completion of, the installation period. Upon execution of the receivables purchase / sales agreement, all amounts due from the customer are included in Revenues earned but not billed on Orion’s consolidated balance sheets until cash is received from the financial institution. The financial institution releases funds to Orion based on the customer’s monthly acknowledgment of the progress Orion has achieved in fulfilling its installation obligation. Orion provides the progress certifications to the financial institution one month in arrears.\n\nThe total amount received from the sales of these receivables during the twelve months ended March 31, 2026, 2025, and 2024 was $1.5 million, $1.8 million and $0 million, respectively. Orion’s losses on these sales aggregated to $0 million, $0.1 million and $0 million for the fiscal years ended March 31, 2026, 2025, and 2024, respectively, and are included in Interest expense in the Consolidated Statements of Operations.\n\nContract Balances\n\nA receivable is recognized when Orion has an enforceable right to payment in accordance with contract terms and an invoice has been issued to the customer. Payment terms on invoiced amounts are typically 30 days from the invoice date.\n\nRevenue earned but not billed represents revenue that has been recognized in advance of billing the customer, which is a common practice in Orion contracts for turnkey installations and repairs / replacement services. Once Orion has an unconditional right to consideration under these contracts, Orion typically bills the customer accordingly and reclassifies the amount to Accounts receivable, net. The change in contract assets is due to higher fiscal 2024 revenue and timing of project completions and invoicing.\n\nDeferred revenue, current as of March 31, 2026, includes $0.1 million of contract liabilities which represent consideration received from customers on which installation has not yet begun or is partially complete and Orion has not fulfilled its contractual obligations.\n\n57\n\n \n\nThe amount of revenues recognized in the period that were included in the opening deferred revenue balances were $0.4 million, $0.1 million, and $0.5 million for the years ended March 31, 2026, 2025, and 2024 respectively. This revenue consists primarily of work performed on previous billings to customers. The difference between the opening and closing balances of Orion's deferred revenue primarily results from the timing of Orion's billings in relation to the performance of work.\n\nThe following chart shows the balance of Orion’s receivables arising from contracts with customers, contract assets and contract liabilities as of March 31, 2026, and March 31, 2025 (dollars in thousands):\n\n \n\n \n\n \n\nMarch 31, 2026\n\n \n\n \n\nMarch 31, 2025\n\n \n\n \n\nMarch 31, 2024\n\n \n\nAccounts receivable, net\n\n \n\n$\n\n16,340\n\n \n\n \n\n$\n\n12,845\n\n \n\n \n\n$\n\n14,022\n\n \n\nRevenue earned but not billed (1)\n\n \n\n$\n\n6,409\n\n \n\n \n\n$\n\n2,908\n\n \n\n \n\n$\n\n4,539\n\n \n\nDeferred revenue (2)(3)\n\n \n\n$\n\n107\n\n \n\n \n\n$\n\n367\n\n \n\n \n\n$\n\n124\n\n \n\n \n\n(1) Within the revenue earned but not billed line on the consolidated balance sheet, $0 million in fiscal 2026 and $0.4 million in fiscal 2025 is accounted for as a sales type lease under ASC 842, Leases, and therefore has been excluded from this table since it is not considered a \"contract asset\", which is an asset defined by ASC 606.\n\n(2) Fiscal 2025 and 2024 included the unamortized portion of the funds received from the federal government in 2010 and 2011 as reimbursement for the costs to build the two facilities related to the PPAs. As the transaction is not considered a contract with a customer, this value is not a contract liability as defined by ASC 606.\n\n(3) Fiscal 2026, 2025, and 2024 include revenue related to a patented technology related settlement. As the transaction is not considered a contract with a customer, this value is not a contract liability as defined by ASC 606.\n\n \n\nNOTE 4 — ACCOUNTS RECEIVABLE\n\nOrion’s accounts receivable are due from companies in the commercial, governmental, industrial and agricultural industries, as well as wholesalers. Credit is extended based on an evaluation of a customer’s financial condition. Generally, collateral is not required for end users; however, the payment of certain trade accounts receivable from wholesalers is secured by irrevocable standby letters of credit and/or guarantees. Accounts receivable are generally due within 30 days. Orion's accounts receivable and allowance for credit losses balances were as follows (dollars in thousands):\n\n \n\n \n\n \n\n2026\n\n \n\n \n\n2025\n\n \n\nAccounts receivable, gross\n\n \n\n$\n\n16,514\n\n \n\n \n\n$\n\n12,909\n\n \n\nAllowance for credit losses\n\n \n\n \n\n(174\n\n)\n\n \n\n \n\n(64\n\n)\n\nAccounts receivable, net\n\n \n\n$\n\n16,340\n\n \n\n \n\n$\n\n12,845\n\n \n\n \n\nChanges in Orion’s allowance for credit losses were as follows (dollars in thousands):\n\n \n\nFiscal Year Ended March 31,\n\n \n\n \n\n2026\n\n \n\n \n\n2025\n\n \n\n \n\n2024\n\n \n\nBeginning of period\n\n$\n\n(64\n\n)\n\n \n\n$\n\n(72\n\n)\n\n \n\n$\n\n(86\n\n)\n\nReserve adjustment\n\n \n\n—\n\n \n\n \n\n \n\n14\n\n \n\n \n\n \n\n—\n\n \n\nCredit loss/bad debt expense\n\n \n\n(110\n\n)\n\n \n\n \n\n(392\n\n)\n\n \n\n \n\n(170\n\n)\n\nWrite-off\n\n \n\n—\n\n \n\n \n\n \n\n386\n\n \n\n \n\n \n\n184\n\n \n\nEnd of period\n\n$\n\n(174\n\n)\n\n \n\n$\n\n(64\n\n)\n\n \n\n$\n\n(72\n\n)\n\n \n\n \n\n58\n\n \n\nNOTE 5 — INVENTORIES\n\nAs of March 31, 2026 and 2025, Orion's inventory balances, net of excess and obsolete reserves of $2.2 million and $1.8 million, respectively, were as follows (dollars in thousands):\n\n \n\n \n\n \n\nInventories\n\n \n\nAs of March 31, 2026\n\n \n\n \n\n \n\nRaw materials and components\n\n \n\n$\n\n2,560\n\n \n\nWork in process\n\n \n\n \n\n150\n\n \n\nFinished goods\n\n \n\n \n\n7,594\n\n \n\nTotal\n\n \n\n$\n\n10,304\n\n \n\nAs of March 31, 2025\n\n \n\n \n\n \n\nRaw materials and components\n\n \n\n$\n\n4,691\n\n \n\nWork in process\n\n \n\n \n\n286\n\n \n\nFinished goods\n\n \n\n \n\n6,415\n\n \n\nTotal\n\n \n\n$\n\n11,392\n\n \n\n \n\nCosts associated with the procurement and warehousing of inventories, such as inbound freight charges and purchasing and receiving costs, are also included in Cost of product revenue.\n\nNOTE 6 — PREPAID EXPENSES AND OTHER CURRENT ASSETS\n\nPrepaid expenses consists primarily of prepaid insurance premiums, debt issue costs, prepaid subscription fees, prepaid networking services for EV products, ERP system implementation fees, and value added tax receivable. As of March 31, 2026 and March 31, 2025, prepaid expenses totaled $1.4 million and $1.9 million, respectively.\n\nNOTE 7 — PROPERTY AND EQUIPMENT\n\nProperty and equipment are stated at cost. Expenditures for additions and improvements are capitalized, while replacements, maintenance and repairs, which do not improve or extend the lives of the respective assets, are expensed as incurred. Properties and equipment sold, or otherwise disposed of, are removed from the property and equipment accounts, with gains or losses on disposal credited or charged to income from operations.\n\nOrion periodically reviews the carrying values of property and equipment for impairment in accordance with ASC 360, Property, Plant and Equipment, if events or changes in circumstances indicate that the assets may be impaired. The estimated future undiscounted cash flows expected to result from the use of the assets and their eventual disposition are compared to the assets' carrying amount to determine if a write down to market value is required. In March 2026, Orion disposed of its remaining solar assets which resulted in a loss on disposal of $1.1 million and is reflected in the consolidated statements of operations in general and administrative expenses.\n\nProperty and equipment were comprised of the following (dollars in thousands):\n\n \n\n \n\n \n\nMarch 31, 2026\n\n \n\n \n\nMarch 31, 2025\n\n \n\nLand and land improvements\n\n \n\n$\n\n433\n\n \n\n \n\n$\n\n433\n\n \n\nBuildings and building improvements\n\n \n\n \n\n9,552\n\n \n\n \n\n \n\n9,552\n\n \n\nFurniture, fixtures and office equipment\n\n \n\n \n\n7,667\n\n \n\n \n\n \n\n7,886\n\n \n\nLeasehold improvements\n\n \n\n \n\n490\n\n \n\n \n\n \n\n493\n\n \n\nEquipment leased to customers\n\n \n\n \n\n-\n\n \n\n \n\n \n\n4,997\n\n \n\nPlant equipment\n\n \n\n \n\n6,043\n\n \n\n \n\n \n\n11,011\n\n \n\nVehicles\n\n \n\n \n\n464\n\n \n\n \n\n \n\n464\n\n \n\nConstruction in progress\n\n \n\n \n\n47\n\n \n\n \n\n \n\n—\n\n \n\nGross property and equipment\n\n \n\n \n\n24,696\n\n \n\n \n\n \n\n34,836\n\n \n\nLess: accumulated depreciation and amortization\n\n \n\n \n\n(18,582\n\n)\n\n \n\n \n\n(26,810\n\n)\n\nTotal property and equipment, net\n\n \n\n$\n\n6,114\n\n \n\n \n\n$\n\n8,026\n\n \n\n \n\n59\n\n \n\nDepreciation and amortization is recognized over the estimated useful lives of the respective assets, using the straight-line method. Orion recorded depreciation and amortization expense of $0.9 million, $1.3 million and $1.4 million for the years ended March 31, 2026, 2025 and 2024, respectively.\n\nDepreciable lives by asset category are as follows:\n\n \n\nLand improvements\n\n \n\n10-15 years\n\nBuildings and building improvements\n\n \n\n10-39 years\n\nFurniture, fixtures and office equipment\n\n \n\n2-10 years\n\nLeasehold improvements\n\n \n\nShorter of asset life or life of lease\n\nEquipment leased to customers under Power Purchase Agreements\n\n \n\n20 years\n\nPlant equipment\n\n \n\n3-10 years\n\nVehicles\n\n \n\n5-7 years\n\n \n\nNOTE 8 — LEASES\n\n \n\nAssets Orion Leases from Other Parties\n\nOn January 31, 2020, Orion entered into the current lease for its primary manufacturing and distribution facility in Manitowoc, Wisconsin, the term of which lease ends January 31, 2030. Orion is responsible for the costs of insurance and utilities for the facility. These costs are considered variable lease costs. The agreement is classified as an operating lease.\n\nIn February 2014, Orion entered into a multi-year lease agreement for use of office space in a multi-use office building in Jacksonville, Florida. The lease has since been extended, most recently during the first quarter of fiscal 2027, and presently terminates on June 30, 2029. The agreement is classified as an operating lease.\n\nWe lease office space in Lawrence, Massachusetts. The lease presently terminates in August 2026. The agreement is classified as an operating lease.\n\nAdditionally, we had a lease in Pewaukee, Wisconsin that was terminated early in August of fiscal 2025. The agreement was classified as an operating lease. Additional details regarding the early termination can be seen in Note 18 - Restructuring.\n\nOrion has leased other assets from third parties, principally office and production equipment. The terms of our other leases vary from contract to contract and expire at various dates in the next five years.\n\nThe weighted average discount rate for Orion’s lease obligations as of March 31, 2026 and 2025 is 6.9% and 6.8%, respectively. The weighted average remaining lease term as of March 31, 2026 and 2025 is 3.7 years and 4.5 years, respectively.\n\nA summary of Orion’s assets leased from third parties follows (dollars in thousands):\n\n \n\n \n\nBalance sheet classification\n\n \n\nMarch 31, 2026\n\n \n\n \n\nMarch 31, 2025\n\n \n\nAssets\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nOperating lease assets\n\n \n\n Other long-term assets, net\n\n \n\n$\n\n2,673\n\n \n\n \n\n$\n\n3,456\n\n \n\nLiabilities\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCurrent liabilities\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nOperating lease liabilities\n\n \n\n Accrued expenses and other\n\n \n\n \n\n715\n\n \n\n \n\n \n\n794\n\n \n\nNon-current liabilities\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nOperating lease liabilities\n\n \n\n Other long-term liabilities\n\n \n\n \n\n2,115\n\n \n\n \n\n \n\n2,829\n\n \n\nTotal lease liabilities\n\n \n\n \n\n \n\n$\n\n2,830\n\n \n\n \n\n$\n\n3,623\n\n \n\n \n\nOrion had operating lease costs of $1.2 million, $1.2 million, and $1.9 million for the years ended March 31, 2026, 2025, and 2024, respectively. This includes short-term leases and variable lease costs, which are immaterial.\n\n \n\n60\n\n \n\nThe estimated maturity of lease liabilities for each of the future years is shown below (dollars in thousands):\n\nMaturity of Lease Liabilities\n\n \n\nOperating Leases\n\n \n\nFiscal 2027\n\n \n\n$\n\n886\n\n \n\nFiscal 2028\n\n \n\n \n\n803\n\n \n\nFiscal 2029\n\n \n\n \n\n828\n\n \n\nFiscal 2030\n\n \n\n \n\n707\n\n \n\nTotal lease payments\n\n \n\n$\n\n3,224\n\n \n\nLess: Interest\n\n \n\n \n\n(394\n\n)\n\nPresent value of lease liabilities\n\n \n\n$\n\n2,830\n\n \n\n \n\nAssets Orion Leases to Other Parties\n\nOrion provides long-term financing to one customer who frequently engages Orion in large turnkey projects that span between three and nine months. The customer executes an agreement providing for monthly payments, at a fixed monthly amount, of the contract price, plus interest, over typically a five-year period. The total transaction price in these contracts is allocated between product and services in the same manner as all other turnkey projects. The portion of the transaction associated with the installation is accounted for consistently with all other installation related performance obligations under ASC 606.\n\nWhile Orion retains ownership of the light fixtures during the financing period, the transaction terms and the underlying economics associated with used lighting fixtures results in Orion essentially ceding ownership of the lighting fixtures to the customer after completion of the agreement. Therefore, the portions of the transaction associated with the sale of the multiple individual light fixtures is accounted for as a sales-type lease under ASC 842.\n\nRevenues, and production and acquisition costs, associated with sales-type leases are included in Product revenue and Costs of product revenues in the consolidated statement of operations. These amounts are recorded for each fixture separately based on the customer’s monthly acknowledgment that specified fixtures have been installed and are operating as specified. The execution of the acknowledgment is considered the commencement date as defined in ASC 842.\n\nThe following chart shows the amount of revenue and cost of sales arising from sales-type leases during the year ended March 31, 2026, 2025 and 2024 (dollars in thousands):\n\n \n\n \n\n \n\nMarch 31, 2026\n\n \n\n \n\nMarch 31, 2025\n\n \n\n \n\nMarch 31, 2024\n\n \n\nProduct revenue\n\n \n\n$\n\n393\n\n \n\n \n\n$\n\n781\n\n \n\n \n\n$\n\n—\n\n \n\nCost of product revenue\n\n \n\n \n\n316\n\n \n\n \n\n \n\n785\n\n \n\n \n\n \n\n—\n\n \n\n \n\nThe consolidated balance sheet as of March 31, 2026 and 2025 includes a net investment of $0 million and $0.4 million, respectively, in sales-type leases as all amounts due from the customer associated with lighting fixtures that were acknowledged to be installed and working correctly prior to period end were not transferred to the financing institution prior to the balance sheet date. During fiscal 2026, Orion sold receivables having an aggregate face value of $1.1 million to the financing institution in exchange for cash proceeds of $1.1 million. Related servicing fees for the period were immaterial.\n\n \n\nOther Agreements where Orion is the Lessor\n\nOrion has leased unused portions of its corporate headquarters to third parties. The length and payment terms of the leases vary from contract to contract and, in some cases, include options for the tenants to extend the lease terms. Annual lease payments are recorded as a reduction in administrative operating expenses and were not material in the years ended March 31, 2026, 2025 and 2024. Orion has accounted for these transactions as operating leases.\n\nNOTE 9 — GOODWILL AND OTHER INTANGIBLE ASSETS\n\nOrion has $0.9 million of goodwill related to its purchase of Voltrek in the third quarter of fiscal 2023, which is assigned to the EV segment.\n\n61\n\n \n\nOrion has $0.6 million of goodwill related to its purchase of Stay-Lite Lighting during fiscal year 2022, which is assigned to the Orion maintenance segment.\n\nThe costs of specifically identifiable intangible assets that do not have an indefinite life are amortized over their estimated useful lives. Goodwill and intangible assets with indefinite lives are not amortized.\n\nAmortizable intangible assets are amortized over their estimated economic useful life to reflect the pattern of economic benefits consumed based upon the following lives and methods:\n\n \n\nPatents\n\n \n\n10-17 years\n\n \n\nStraight-line\n\nLicenses\n\n \n\n7-13 years\n\n \n\nStraight-line\n\nCustomer relationships\n\n \n\n5-8 years\n\n \n\nAccelerated based upon the pattern of economic benefits\nconsumed\n\nVendor relationships\n\n \n\n5-8 years\n\n \n\nAccelerated based upon the pattern of economic benefits\nconsumed\n\nDeveloped technology\n\n \n\n8 years\n\n \n\nAccelerated based upon the pattern of economic benefits\nconsumed\n\nTradename\n\n \n\n5-10 years\n\n \n\nStraight-line\n\n \n\nOrion performed a qualitative assessment in conjunction with its annual impairment test of its indefinite lived intangible assets and goodwill as of January 1, 2026. This qualitative assessment considered Orion’s operating results for the first nine months of fiscal 2026 in comparison to prior years as well as its anticipated fourth quarter results and fiscal 2026 plan. As a result of the conditions that existed as of the assessment date, an asset impairment was not deemed to be more likely than not and a quantitative analysis was not required.\n\nOrion performed a qualitative assessment in conjunction with its annual impairment test of its indefinite lived intangible assets and goodwill as of January 1, 2025. This qualitative assessment considered Orion’s operating results for the first nine months of fiscal 2025 in comparison to prior years as well as its anticipated fourth quarter results and fiscal 2025 plan. As a result of the conditions that existed as of the assessment date, an asset impairment was not deemed to be more likely than not and a quantitative analysis was not required.\n\n \n\n \n\n62\n\n \n\nThe components of, and changes in, the carrying amount of other intangible assets were as follows (dollars in thousands):\n\n \n\n \n\nMarch 31, 2026\n\n \n\n \n\nMarch 31, 2025\n\n \n\n \n\n \n\nGross\nCarrying\nAmount\n\n \n\n \n\nAccumulated\nAmortization\n\n \n\n \n\nNet\n\n \n\n \n\nWeighted Average Useful Life\n\n \n\n \n\nGross\nCarrying\nAmount\n\n \n\n \n\nAccumulated\nAmortization\n\n \n\n \n\nNet\n\n \n\nAmortized Intangible Assets\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nPatents\n\n \n\n$\n\n1,865\n\n \n\n \n\n$\n\n(1,603\n\n)\n\n \n\n$\n\n262\n\n \n\n \n\n \n\n8.5\n\n \n\n \n\n$\n\n1,895\n\n \n\n \n\n$\n\n(1,568\n\n)\n\n \n\n$\n\n327\n\n \n\nLicenses\n\n \n\n \n\n58\n\n \n\n \n\n \n\n(58\n\n)\n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n58\n\n \n\n \n\n \n\n(58\n\n)\n\n \n\n \n\n—\n\n \n\nTrade name and trademarks\n\n \n\n \n\n300\n\n \n\n \n\n \n\n(209\n\n)\n\n \n\n \n\n91\n\n \n\n \n\n \n\n1.5\n\n \n\n \n\n \n\n300\n\n \n\n \n\n \n\n(150\n\n)\n\n \n\n \n\n150\n\n \n\nCustomer relationships\n\n \n\n \n\n5,000\n\n \n\n \n\n \n\n(5,000\n\n)\n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n5,000\n\n \n\n \n\n \n\n(4,763\n\n)\n\n \n\n \n\n237\n\n \n\nVendor relationships\n\n \n\n \n\n2,600\n\n \n\n \n\n \n\n(1,297\n\n)\n\n \n\n \n\n1,303\n\n \n\n \n\n \n\n3.5\n\n \n\n \n\n \n\n2,600\n\n \n\n \n\n \n\n(925\n\n)\n\n \n\n \n\n1,675\n\n \n\nDeveloped technology\n\n \n\n \n\n900\n\n \n\n \n\n \n\n(900\n\n)\n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n900\n\n \n\n \n\n \n\n(900\n\n)\n\n \n\n \n\n—\n\n \n\nTotal Amortized Intangible Assets\n\n \n\n$\n\n10,723\n\n \n\n \n\n$\n\n(9,067\n\n)\n\n \n\n$\n\n1,656\n\n \n\n \n\n \n\n4.2\n\n \n\n \n\n$\n\n10,753\n\n \n\n \n\n$\n\n(8,364\n\n)\n\n \n\n$\n\n2,389\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nIndefinite-lived Intangible Assets\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nTrade name and trademarks\n\n \n\n$\n\n990\n\n \n\n \n\n$\n\n—\n\n \n\n \n\n$\n\n990\n\n \n\n \n\n \n\n \n\n \n\n$\n\n990\n\n \n\n \n\n$\n\n—\n\n \n\n \n\n$\n\n990\n\n \n\nTotal Indefinite-lived Intangible Assets\n\n \n\n$\n\n990\n\n \n\n \n\n$\n\n—\n\n \n\n \n\n$\n\n990\n\n \n\n \n\n \n\n \n\n \n\n$\n\n990\n\n \n\n \n\n$\n\n—\n\n \n\n \n\n$\n\n990\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nTotal Other Intangible Assets\n\n \n\n$\n\n11,713\n\n \n\n \n\n$\n\n(9,067\n\n)\n\n \n\n$\n\n2,646\n\n \n\n \n\n \n\n \n\n \n\n$\n\n11,743\n\n \n\n \n\n$\n\n(8,364\n\n)\n\n \n\n$\n\n3,379\n\n \n\nThe estimated amortization expense for each of the next five years is shown below (dollars in thousands):\n\nFiscal 2027\n\n \n\n \n\n475\n\n \n\nFiscal 2028\n\n \n\n \n\n439\n\n \n\nFiscal 2029\n\n \n\n \n\n403\n\n \n\nFiscal 2030\n\n \n\n \n\n218\n\n \n\nFiscal 2031\n\n \n\n \n\n22\n\n \n\nThereafter\n\n \n\n \n\n99\n\n \n\n \n\n$\n\n1,656\n\n \n\nAmortization expense is set forth in the following table (dollars in thousands):\n\n \n\n \n\nFiscal Year Ended March 31,\n\n \n\n \n\n \n\n2026\n\n \n\n \n\n2025\n\n \n\n \n\n2024\n\n \n\nAmortization included in cost of revenue:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nPatents\n\n \n\n$\n\n65\n\n \n\n \n\n$\n\n171\n\n \n\n \n\n$\n\n99\n\n \n\nTotal\n\n \n\n$\n\n65\n\n \n\n \n\n$\n\n171\n\n \n\n \n\n$\n\n99\n\n \n\nAmortization included in operating expenses:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCustomer relationships\n\n \n\n$\n\n237\n\n \n\n \n\n$\n\n467\n\n \n\n \n\n$\n\n525\n\n \n\nVendor relationships\n\n \n\n \n\n371\n\n \n\n \n\n \n\n371\n\n \n\n \n\n \n\n371\n\n \n\nTradename\n\n \n\n \n\n60\n\n \n\n \n\n \n\n60\n\n \n\n \n\n \n\n90\n\n \n\nTotal\n\n \n\n \n\n668\n\n \n\n \n\n \n\n898\n\n \n\n \n\n \n\n986\n\n \n\nTotal amortization of intangible assets\n\n \n\n$\n\n733\n\n \n\n \n\n$\n\n1,069\n\n \n\n \n\n$\n\n1,085\n\n \n\nOrion’s management periodically reviews the carrying value of patent applications and related costs. When a patent application is probable of being unsuccessful or a patent is no longer in use, Orion writes off the remaining carrying value as a charge to general and administrative expense within its consolidated statements of operations. In fiscal years 2026, 2025, and 2024, write-offs were immaterial.\n\n63\n\n \n\nNOTE 10 — ACCRUED EXPENSES AND OTHER\n\nAs of March 31, 2026 and March 31, 2025, Accrued expenses and other included the following (dollars in thousands):\n\n \n\n \n\n \n\nMarch 31, 2026\n\n \n\n \n\nMarch 31, 2025\n\n \n\nAccrued acquisition earnout\n\n \n\n$\n\n—\n\n \n\n \n\n$\n\n3,263\n\n \n\nOther accruals\n\n \n\n \n\n1,857\n\n \n\n \n\n \n\n2,180\n\n \n\nCompensation and benefits\n\n \n\n \n\n3,620\n\n \n\n \n\n \n\n2,424\n\n \n\nCredits due to customers\n\n \n\n \n\n1,193\n\n \n\n \n\n \n\n1,581\n\n \n\nAccrued project costs\n\n \n\n \n\n2,979\n\n \n\n \n\n \n\n2,283\n\n \n\nWarranty\n\n \n\n \n\n361\n\n \n\n \n\n \n\n449\n\n \n\nSales tax\n\n \n\n \n\n322\n\n \n\n \n\n \n\n273\n\n \n\nLegal and professional fees\n\n \n\n \n\n294\n\n \n\n \n\n \n\n177\n\n \n\nSales returns reserve\n\n \n\n \n\n102\n\n \n\n \n\n \n\n98\n\n \n\nTotal\n\n \n\n$\n\n10,728\n\n \n\n \n\n$\n\n12,728\n\n \n\nOrion generally offers a limited warranty of one to 10 years on its lighting products including the pass through of standard warranties offered by major original equipment component manufacturers. The manufacturers’ warranties cover lamps, ballasts, LED modules, LED chips, LED drivers, control devices, and other fixture related items, which are significant components in Orion's lighting products.\n\nChanges in Orion’s warranty accrual (both current and long-term) were as follows (dollars in thousands):\n\n \n\n \n\n \n\nMarch 31,\n\n \n\n \n\n \n\n2026\n\n \n\n \n\n2025\n\n \n\n \n\n2024\n\n \n\nBeginning of year\n\n \n\n$\n\n639\n\n \n\n \n\n$\n\n725\n\n \n\n \n\n$\n\n646\n\n \n\nAccruals\n\n \n\n \n\n266\n\n \n\n \n\n \n\n350\n\n \n\n \n\n \n\n473\n\n \n\nWarranty claims (net of vendor reimbursements)\n\n \n\n \n\n(376\n\n)\n\n \n\n \n\n(436\n\n)\n\n \n\n \n\n(394\n\n)\n\nEnding balance\n\n \n\n$\n\n529\n\n \n\n \n\n$\n\n639\n\n \n\n \n\n$\n\n725\n\n \n\nAs of March 31, 2025, the balance of the accrued earnout liability with respect to Orion’s October 5, 2022 acquisition of Voltrek was $3.3 million. During the second quarter of fiscal 2026, Orion issued common stock to the prior owner of Voltrek with a value of $1 million and paid $875 thousand in cash as partial payment of the accrued acquisition earnout. These compensatory payments have been expensed over the course of the earnout periods.\n\nOn March 17, 2026, Orion entered into a settlement agreement (the “Settlement Agreement”) with Final Frontier, LLC (“Final Frontier”) and Kathleen M. Connors (“Ms. Connors”), personally and as Trustee of the Kathleen M. Connors 2019 Revocable Trust (“Connors Trust” together with Final Frontier and Ms. Connors, the “Connors Parties”), in order to reach a final and complete resolution and settlement of the dispute regarding Orion’s remaining earnout obligations owed to Final Frontier, as well as to reach a final and complete resolution and settlement of related arbitrations and terminate related agreements, as described in Note 12 – Debt, below.\n\nUnder the terms of the Settlement Agreement, the Company made a one-time cash payment of $3.0 million (the “Settlement Amount”) to Final Frontier on March 18, 2026. This compensatory payment has been expensed over the course of the earnout periods. As a result of the payment of the Settlement Amount, the balance of the accrued earnout liability with respect to the Voltrek acquisition as of March 31, 2026 was $0 million. See Note 12 - Debt, below for additional details around the previously accrued earnout liability and the settlement of the earnout liability.\n\n \n\n64\n\n \n\nNOTE 11 — NET (LOSS) INCOME PER COMMON SHARE\n\nBasic net (loss) income per common share is computed by dividing net (loss) income by the weighted-average number of common shares outstanding for the period and does not consider common stock equivalents.\n\nDiluted net (loss) income per common share reflects the dilution that would occur if stock options were exercised and restricted shares vested. In the computation of diluted net (loss) income per common share, Orion uses the treasury stock method for outstanding options and restricted shares. Net (loss) income per common share is calculated based upon the following shares:\n\n \n\n \n\n \n\nFiscal Year Ended March 31,\n\n \n\n \n\n \n\n2026\n\n \n\n \n\n2025\n\n \n\n \n\n2024\n\n \n\nNumerator:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nNet (loss) income (dollars in thousands)\n\n \n\n$\n\n(3,163\n\n)\n\n \n\n$\n\n(11,801\n\n)\n\n \n\n$\n\n(11,671\n\n)\n\nDenominator:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nWeighted-average common shares outstanding\n\n \n\n \n\n3,560,671\n\n \n\n \n\n \n\n3,282,947\n\n \n\n \n\n \n\n3,248,624\n\n \n\nWeighted-average effect of assumed conversion of stock options and restricted stock\n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\nWeighted-average common shares and share equivalents outstanding\n\n \n\n \n\n3,560,671\n\n \n\n \n\n \n\n3,282,947\n\n \n\n \n\n \n\n3,248,624\n\n \n\nNet (loss) income per common share:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nBasic\n\n \n\n$\n\n(0.89\n\n)\n\n \n\n$\n\n(3.59\n\n)\n\n \n\n$\n\n(3.59\n\n)\n\nDiluted\n\n \n\n$\n\n(0.89\n\n)\n\n \n\n$\n\n(3.59\n\n)\n\n \n\n$\n\n(3.59\n\n)\n\n \n\nThe following table indicates the number of potentially dilutive securities excluded from the calculation of Diluted net (loss) income per common share because their inclusion would have been anti-dilutive. The number of shares is as of the end of each period:\n\n \n\n \n\n \n\nMarch 31,\n\n \n\n \n\n \n\n2026\n\n \n\n \n\n2025\n\n \n\n \n\n2024\n\n \n\nTime-Based Restricted Shares\n\n \n\n \n\n114,078\n\n \n\n \n\n \n\n133,159\n\n \n\n \n\n \n\n101,410\n\n \n\nPerformance-Based Restricted Shares\n\n \n\n \n\n47,065\n\n \n\n \n\n \n\n152,994\n\n \n\n \n\n \n\n70,838\n\n \n\nTotal\n\n \n\n \n\n161,143\n\n \n\n \n\n \n\n286,153\n\n \n\n \n\n \n\n172,248\n\n \n\n \n\nNOTE 12 — DEBT\n\nDebt, including the revolving credit facility as of March 31, 2026 and 2025 consisted of the following (dollars in thousands):\n\n \n\n \n\n \n\nMarch 31,\n\n \n\n \n\n \n\n2026\n\n \n\n \n\n2025\n\n \n\nRevolving credit facility\n\n \n\n$\n\n3,000\n\n \n\n \n\n$\n\n7,000\n\n \n\nTerm loan\n\n \n\n \n\n2,972\n\n \n\n \n\n \n\n3,324\n\n \n\nTotal long-term debt\n\n \n\n \n\n5,972\n\n \n\n \n\n \n\n10,324\n\n \n\nLess current maturities\n\n \n\n \n\n(353\n\n)\n\n \n\n \n\n(353\n\n)\n\nLong-term debt, less current maturities\n\n \n\n$\n\n5,619\n\n \n\n \n\n$\n\n9,971\n\n \n\n \n\nRevolving Credit Agreement\n\nOn December 29, 2020, Orion entered into a Loan and Security Agreement with Bank of America, N.A., as lender (the “Credit Agreement”). The Credit Agreement provides for a five-year $25.0 million revolving credit facility (the “Credit Facility”) that, as of March 31, 2026, was scheduled to mature on June 30, 2027. Borrowings under the Credit Facility are subject to a borrowing base requirement based on eligible receivables, inventory and cash. As of March 31, 2026, the borrowing base of the Credit Facility supports $15.6 million of availability, with $12.6 million remaining availability subject to a $0.5 million availability block, net of $3.0 million borrowed.\n\nThe Credit Agreement is secured by a first lien security interest in substantially all of Orion’s assets.\n\n65\n\n \n\nBorrowings under the Credit Agreement are permitted in the form of Secured Overnight Financing Rate (\"SOFR\") or prime rate-based loans and generally bear interest at floating rates plus an applicable margin determined by reference to Orion’s availability under the Credit Agreement. Among other fees, Orion is required to pay an annual facility fee and a fee on the unused portion of the Credit Facility.\n\nThe Credit Agreement includes a springing minimum fixed cost coverage ratio of 1.0 to 1.0 when excess availability under the Credit Facility falls below $4.0 million of the committed facility. Currently, the required springing minimum fixed cost coverage ratio is not required.\n\nThe Credit Agreement also contains customary events of default and other covenants, including certain restrictions on Orion’s ability to incur additional indebtedness, consolidate or merge, enter into acquisitions, pay any dividend or distribution on Orion’s stock, redeem, retire or purchase shares of Orion’s stock, make investments or pledge or transfer assets. If an event of default under the Credit Agreement occurs and is continuing, then the lender may cease making advances under the Credit Agreement and declare any outstanding obligations under the Credit Agreement to be immediately due and payable. In addition, if Orion becomes the subject of voluntary or involuntary proceedings under any bankruptcy or similar law, then any outstanding obligations under the Credit Agreement will automatically become immediately due and payable.\n\nEffective November 4, 2022, Orion, with Bank of America, N.A. as lender, executed Amendment No. 1 to its Credit Agreement. The primary purpose of the amendment was to include the assets of the acquired subsidiaries, Stay-Lite Lighting and Voltrek, as secured collateral under the Credit Agreement and to document the conversion from LIBOR to SOFR based loans. Accordingly, eligible assets of Stay-Lite and Voltrek will be included in the borrowing base calculation for the purpose of establishing the monthly borrowing availability under the Credit Agreement. The amendment also clarifies that the earnout liabilities associated with the Stay-Lite and Voltrek transactions are permitted under the Credit Agreement and that the expenses recognized in connection with those earnouts should be added back in the computation of EBITDA, as defined, under the Credit Agreement.\n\nEffective April 22, 2024, Orion, with Bank of America, N.A. as lender, executed Amendment No. 2 to its Credit Agreement (“Amendment No. 2”). The primary purpose of Amendment No. 2 was to add a $3.525 million mortgage loan facility to the Credit Agreement secured by Orion’s office headquarters property in Manitowoc, Wisconsin. Amendment No. 2 also broadened the definition of receivables to encompass government receivables as being eligible to be included in Orion’s borrowing base calculation for the purpose of establishing Orion’s monthly borrowing availability under the Credit Agreement. Quarterly installments of $88,125 are due on the first day of each fiscal quarter.\n\nEffective October 30, 2024, Orion, with Bank of America, N.A. as lender, executed Amendment No. 3 (\"Amendment No. 3\") to its Credit Agreement. The primary purpose of Amendment No. 3 was to extend the maturity date of the Credit Facility from December 29, 2025 to June 30, 2027.\n\nAs of March 31, 2026, Orion was in compliance with all debt covenants.\n\nAggregate Maturities\n\nAs of March 31, 2026, aggregate maturities of debt, including the revolving credit facility were as follows (dollars in thousands):\n\n \n\nFiscal 2027\n\n \n\n \n\n353\n\n \n\nFiscal 2028\n\n \n\n \n\n5,619\n\n \n\n \n\n$\n\n5,972\n\n \n\n \n\nEffective on June 23, 2025, Orion entered into a binding term sheet (the “Initial Term Sheet”) with Final Frontier, LLC (“Final Frontier”) and its owner Kathleen Connors (“Ms. Connors”), the prior owner of Voltrek, with respect to Orion’s remaining earnout obligations owed to Final Frontier pursuant to that certain Membership Interest Purchase Agreement, dated as of October 5, 2022, entered into by and among us and Final Frontier and Ms. Connors (the “MIPA”), pursuant to which Orion acquired Voltrek on October 5, 2022. Pursuant to the Initial Term Sheet, on August 1, 2025, Orion paid Final Frontier $500,000, and on September 2, 2025, Orion paid an additional $375,000, in full and final payment of its fiscal 2024 Voltrek acquisition earnout obligations. Additionally, pursuant\n\n66\n\n \n\nto the Initial Term Sheet, on July 16, 2025, Orion issued $1.0 million in common stock of Orion, constituting 164,908 shares, to Kathleen Connors and the Kathleen M. Connors 2019 Revocable Trust in partial payment of Orion’s fiscal 2025 and aggregate fiscal 2023 through fiscal 2025 Voltrek acquisition earnout obligations. On July 31, 2025, Orion entered into an amendment to the Initial Term Sheet (the “Term Sheet Amendment”, and together with the Initial Term Sheet, the “Term Sheet”), pursuant to which Orion agreed with Final Frontier to pay the remainder of the finally determined remaining amount of Orion’s fiscal 2025 Voltrek acquisition earnout obligations (the “Remaining Earnout Amount”) pursuant to a subordinated loan agreement, entered into by Orion, as borrower, Great Lakes Energy Technologies, LLC (“Great Lakes”), Clean Energy Solutions, LLC (“Clean Energy”), Orion Asset Management, LLC (“Asset Management”), Orion Technologies Ventures, LLC (“Orion Technology”, and together with Voltrek, Clean Energy, Asset Management and Orion Technology, the “Company Subsidiaries”) and Voltrek, as guarantors, and Final Frontier, as lender (the “Subordinated Loan Agreement”). In addition, Orion and Final Frontier agreed to submit the final determination of its Remaining Earnout Amount to binding arbitration.\n\nOrion’s obligation to pay the Remaining Earnout Amount was further evidenced by a Senior Subordinated Note. On September 30, 2025, in order to secure Orion’s obligations to Final Frontier under the Subordinated Loan Agreement and Senior Subordinated Note, Orion, the Company Subsidiaries and Final Frontier entered into a security agreement (the “Security Agreement”), pursuant to which Orion and each Company Subsidiary granted Final Frontier a security interest in, and lien upon, substantially all of Orion’s and each Company Subsidiary’s assets, which security interest and lien were subordinated pursuant to the Subordination Agreement (as defined below) to the first priority security interest and lien of Bank of America.\n\nAdditionally, on September 30, 2025, Orion, the Company Subsidiaries, Final Frontier and Bank of America, entered into a subordination and intercreditor agreement (the “Subordination Agreement”), pursuant to which Orion and the Company Subsidiaries’ obligations under the Subordinated Loan Agreement and Senior Subordinated Note and liens granted under the Security Agreement were subordinated to Orion’s credit facilities with Bank of America, as set forth in more detail in the Subordination Agreement.\n\nIn connection with Orion’s entry into the Subordinated Loan Agreement, Senior Subordinated Note, Security Agreement and Subordination Agreement, on September 30, 2025, Orion, the Company Subsidiaries and Bank of America entered into an Amendment No. 4 to its Credit Agreement (“Amendment No. 4”), pursuant to which Bank of America consented to the subordinated liens granted by Orion and the Company Subsidiaries in favor of Final Frontier and consented to the Remaining Earnout Amount evidenced by the Subordinated Loan Agreement, subject to: (a) a maximum amount of up $3.0 million following the final determination in binding arbitration of the Remaining Earnout Amount or (b) such higher amount as consented to in writing by Bank of America promptly following its receipt of notice of the binding arbitration decision. In addition, Amendment No. 4 permitted Orion to make the cash interest and principal payments to Final Frontier as set forth in the Subordinated Loan Agreement, subject to the terms set forth in Amendment No. 4 and the Subordination Agreement.\n\nVoltrek Earnout Settlement\n\nOn March 17, 2026, Orion entered into the Settlement Agreement with Connors Parties, in order to reach a final and complete resolution and settlement of the dispute between the Connors Parties and Orion regarding Orion’s remaining Voltrek acquisition earnout obligations, as well as to reach a final and complete resolution and settlement of related arbitrations and terminate related agreements, as described below.\n\nPursuant to the MIPA and the Term Sheet, Orion and the Connors Parties submitted the earnout statement dispute to CPA firm arbitration (the “CPA Firm Arbitration”). The Connors Parties asserted that the remaining earn out payments owed by Orion totaled approximately $10 million. Orion’s position was that Orion owed the Connors Parties an additional $1.4 million. The CPA arbitrators determined that Orion owed an additional $3.4 million of earnout payments. Subsequently, Orion filed an arbitration demand with the American Arbitration Association in Milwaukee, Wisconsin against the Connors Parties in order to object to the CPA firm’s decision of the earnout statement dispute as manifest error (the “AAA Arbitration”).\n\nBy entering into the Settlement Agreement, Orion and the Connors Parties agreed to a final and complete resolution and settlement of the CPA Firm Arbitration and the AAA Arbitration, a final and complete resolution and settlement of the earnout statement dispute, termination of the MIPA, termination of all related earnout agreements, including the Subordinated Loan Agreement, the Senior Subordinated Note, the Security Agreement and the Subordination Agreement, and termination of any and all claims and counterclaims\n\n67\n\n \n\nbetween or among Orion and the Connors Parties, without any admission of liability and without incurring of any further payment, cost, liability, obligation, guaranty, expense or inconvenience with respect thereto.\n\nUnder the terms of the Settlement Agreement, the Company made a one-time cash payment of the Settlement Amount to Final Frontier on March 18, 2026. Upon receipt of the Settlement Amount, all earn out payment obligations, the MIPA, all earnout agreements, the CPA Firm Arbitration and the AAA Arbitration proceedings were terminated, cancelled and released, and all liens and security interests held by Final Frontier on Orion’s assets were automatically terminated and irrevocably released. Additionally, upon payment of the Settlement Amount, Orion and the Connors Parties exchanged mutual general releases of all claims arising from or related to the earnout disputes, the CPA Firm Arbitration and the AAA Arbitration proceedings, the MIPA and the related earnout agreements. The releases did not affect Ms. Connors’ then part-time employment relationship with Orion or the Connors Parties’ rights as shareholders of Orion. Orion also agreed to facilitate the Connors Parties’ entry into a Rule 10b5-1 trading plan during Orion’s next insider open window period to facilitate the Connors Parties’ sale of their shares of Orion’s common stock.\n\n \n\nNOTE 13 — INCOME TAXES\n\nThe total provision for income taxes consists of the following for the fiscal years ended (dollars in thousands):\n\n \n\n \n\n \n\nFiscal Year Ended March 31,\n\n \n\n \n\n \n\n2026\n\n \n\n \n\n2025\n\n \n\n \n\n2024\n\n \n\nPretax Book Income/(Loss)\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nUnited States Federal & State\n\n \n\n$\n\n(3,264\n\n)\n\n \n\n \n\n \n\n \n\n \n\n \n\nCanada\n\n \n\n \n\n161\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nTotal Pretax Book Loss\n\n \n\n \n\n(3,103\n\n)\n\n \n\n \n\n \n\n \n\n \n\n \n\nCurrent:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nUnited States Federal\n\n \n\n$\n\n—\n\n \n\n \n\n$\n\n—\n\n \n\n \n\n$\n\n—\n\n \n\nState\n\n \n\n \n\n55\n\n \n\n \n\n \n\n35\n\n \n\n \n\n \n\n46\n\n \n\nCanada\n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\nTotal Current\n\n \n\n \n\n55\n\n \n\n \n\n \n\n35\n\n \n\n \n\n \n\n46\n\n \n\nDeferred:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nUnited States Federal\n\n \n\n \n\n2\n\n \n\n \n\n \n\n2\n\n \n\n \n\n \n\n(1\n\n)\n\nState\n\n \n\n \n\n3\n\n \n\n \n\n \n\n5\n\n \n\n \n\n \n\n(4\n\n)\n\nCanada\n\n \n\n \n\n—\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nTotal Deferred\n\n \n\n \n\n5\n\n \n\n \n\n \n\n7\n\n \n\n \n\n \n\n(5\n\n)\n\nProvision (benefit) for income taxes\n\n \n\n$\n\n60\n\n \n\n \n\n$\n\n42\n\n \n\n \n\n$\n\n41\n\n \n\n \n\n68\n\n \n\nA reconciliation of the statutory federal income tax rate and effective income tax rate is as follows:\n\n \n\n \n\n \n\nFiscal Year Ended March 31,\n\n \n\n \n\n \n\n \n\n \n\n \n\n2026\n\n \n\n \n\n2025\n\n \n\n \n\n2024\n\n \n\n \n\n \n\nAmount (thousands)\n\n \n\n \n\nPercent\n\n \n\n \n\nPercent\n\n \n\n \n\nPercent\n\n \n\nStatutory federal tax rate\n\n \n\n$\n\n(652\n\n)\n\n \n\n \n\n21.0\n\n%\n\n \n\n \n\n21.0\n\n%\n\n \n\n \n\n21.0\n\n%\n\nState taxes, net (1)\n\n \n\n \n\n44\n\n \n\n \n\n \n\n(1.4\n\n)%\n\n \n\n \n\n4.1\n\n%\n\n \n\n \n\n3.2\n\n%\n\nState tax credits, net\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n(0.2\n\n)%\n\n \n\n \n\n(0.2\n\n)%\n\nForeign tax effects, Canada\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nStatutory tax rate differential\n\n \n\n \n\n10\n\n \n\n \n\n \n\n(0.3\n\n)%\n\n \n\n \n\n \n\n \n\n \n\n \n\nChange in valuation reserve\n\n \n\n \n\n(36\n\n)\n\n \n\n \n\n1.2\n\n%\n\n \n\n \n\n \n\n \n\n \n\n \n\nFederal tax credit\n\n \n\n \n\n111\n\n \n\n \n\n \n\n(3.6\n\n)%\n\n \n\n \n\n(0.5\n\n)%\n\n \n\n \n\n(0.4\n\n)%\n\nChange in valuation reserve\n\n \n\n \n\n507\n\n \n\n \n\n \n\n(16.3\n\n)%\n\n \n\n \n\n(23.7\n\n)%\n\n \n\n \n\n(22.7\n\n)%\n\nEffect of cross-border tax laws, global intangible low-tax income\n\n \n\n \n\n21\n\n \n\n \n\n \n\n(0.7\n\n)%\n\n \n\n \n\n \n\n \n\n \n\n \n\nOther permanent items\n\n \n\n \n\n38\n\n \n\n \n\n \n\n(1.2\n\n)%\n\n \n\n \n\n(0.9\n\n)%\n\n \n\n \n\n(0.8\n\n)%\n\nChange in tax contingency reserve\n\n \n\n \n\n11\n\n \n\n \n\n \n\n(0.4\n\n)%\n\n \n\n \n\n(0.1\n\n)%\n\n \n\n \n\n(0.1\n\n)%\n\nEquity compensation cancellations\n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n(0.2\n\n)%\n\nState return to provision\n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n0.1\n\n%\n\n \n\n \n\n0.1\n\n%\n\nOther, net\n\n \n\n \n\n6\n\n \n\n \n\n \n\n(0.2\n\n)%\n\n \n\n \n\n(0.2\n\n)%\n\n \n\n \n\n(0.3\n\n)%\n\nEffective income tax rate\n\n \n\n$\n\n60\n\n \n\n \n\n \n\n(1.9\n\n)%\n\n \n\n \n\n(0.4\n\n)%\n\n \n\n \n\n(0.4\n\n)%\n\n(1) State taxes in Texas make up the majority (greater than 50 percent) of the tax effect in this category.\n\n \n\nThe net deferred tax assets reported in the accompanying consolidated financial statements include the following components (dollars in thousands):\n\n \n\n \n\n \n\nMarch 31,\n\n \n\n \n\n \n\n2026\n\n \n\n \n\n2025\n\n \n\nDeferred tax assets:\n\n \n\n \n\n \n\n \n\n \n\n \n\nInventory, accruals and reserves\n\n \n\n$\n\n833\n\n \n\n \n\n$\n\n742\n\n \n\nInterest deduction carry-forward\n\n \n\n \n\n497\n\n \n\n \n\n \n\n495\n\n \n\nFederal and state operating loss carry-forwards\n\n \n\n \n\n22,554\n\n \n\n \n\n \n\n22,332\n\n \n\nTax credit carry-forwards\n\n \n\n \n\n1,204\n\n \n\n \n\n \n\n1,367\n\n \n\nEquity compensation\n\n \n\n \n\n132\n\n \n\n \n\n \n\n272\n\n \n\nDeferred revenue\n\n \n\n \n\n—\n\n \n\n \n\n \n\n19\n\n \n\nFixed assets\n\n \n\n \n\n78\n\n \n\n \n\n \n\n—\n\n \n\nLease liabilities\n\n \n\n \n\n722\n\n \n\n \n\n \n\n922\n\n \n\nIntangible assets\n\n \n\n \n\n2,273\n\n \n\n \n\n \n\n1,871\n\n \n\nOther\n\n \n\n \n\n868\n\n \n\n \n\n \n\n1,206\n\n \n\nTotal deferred tax assets\n\n \n\n \n\n29,161\n\n \n\n \n\n \n\n29,226\n\n \n\nValuation allowance\n\n \n\n \n\n(28,563\n\n)\n\n \n\n \n\n(28,149\n\n)\n\nDeferred tax assets, net of valuation allowance\n\n \n\n \n\n598\n\n \n\n \n\n \n\n1,077\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nDeferred tax liabilities:\n\n \n\n \n\n \n\n \n\n \n\n \n\nLease ROU assets\n\n \n\n \n\n(682\n\n)\n\n \n\n \n\n(880\n\n)\n\nFixed assets\n\n \n\n \n\n—\n\n \n\n \n\n \n\n(276\n\n)\n\nTotal deferred tax liabilities\n\n \n\n \n\n(682\n\n)\n\n \n\n \n\n(1,156\n\n)\n\n \n\n \n\n \n\n \n\n \n\n \n\nTotal net deferred tax (liabilities) assets\n\n \n\n$\n\n(84\n\n)\n\n \n\n$\n\n(79\n\n)\n\n \n\nFor fiscal year ended March 31, 2026, Orion’s deferred tax assets were primarily the result of U.S. net operating loss (\"NOL\") and tax credit carryforwards. Orion recorded a valuation allowance of $28.6 million and $28.1 million against its net deferred tax asset balance as of March 31, 2026 and March 31, 2025, respectively, due to the uncertainty of its realization value in the future. For fiscal\n\n69\n\n \n\nyears ended March 31, 2026 and March 31, 2025, the valuation allowance against Orion’s deferred tax assets increased by $0.5 million, primarily due to the current and prior year book losses.\n\nAs of each reporting date, management considers new evidence, both positive and negative, that could affect its view of the future realization of deferred tax assets. Orion considers future taxable income and ongoing prudent and feasible tax planning strategies in assessing the need for the valuation allowance. In the event that Orion determines that the more or less of its deferred tax assets are able to be realized, an adjustment to the valuation allowance would be reflected in the company’s provision for income taxes.\n\nAs of March 31, 2026, Orion has federal NOL carryforwards of approximately $87.2 million, state NOL carryforwards of approximately $73.4 million, and foreign NOL carryforwards of approximately $0.6 million. Orion also had federal tax credit carryforwards of approximately $1.1 million and state tax credits of $0.1 million. All of Orion’s tax credit carryforwards and $123.4 million of its NOL carryforwards will begin to expire in varying amounts between 2026 and 2056. The remaining $37.8 million of its federal and state NOL carryforwards are not subject to time restrictions but may only be used to offset 80% of adjusted taxable income. Orion believes it is more likely than not that the benefit from its state credit carryforwards, foreign NOL carryforwards, federal credit carryforwards, and state loss carryforwards will not be realized. In recognition of this risk, Orion has provided a net valuation allowance of $28.6 million on the deferred tax assets related to these carryforwards.\n\nGenerally, a change of more than 50% in the ownership of Orion's stock, by value, over a three-year period constitutes an ownership change for federal income tax purposes as defined under Section 382 of the Internal Revenue Code. As a result, Orion's ability to use its net operating loss carryforwards, attributable to the period prior to such ownership change, to offset taxable income can be subject to limitations in a particular year, which could potentially result in increased future tax liability for Orion. There was no limitation of NOL carryforwards that occurred for fiscal 2026, fiscal 2025, or fiscal 2024.\n\nOrion records its tax provision based on the respective tax rules and regulations for the jurisdictions in which it operates. Where Orion believes that a tax position is supportable for income tax purposes, the item is included in their income tax returns. Where treatment of a position is uncertain, a liability is recorded based upon the expected most likely outcome taking into consideration the technical merits of the position based on specific tax regulations and facts of each matter. These liabilities may be affected by changing interpretations of laws, rulings by tax authorities, or the expiration of the statute of limitations.\n\nOrion files income tax returns in the United States federal jurisdiction and in several state jurisdictions. The Company's federal tax returns for tax years beginning April 1, 2021 or later are open. For states in which Orion files state income tax returns, the statute of limitations is generally open for tax years beginning April 1, 2021 or later.\n\nState income tax returns are generally subject to examination for a period of 3 to 5 years after filing of the respective return. The state effect of any federal changes remains subject to examination by various states for a period of up to two years after formal notification to the states. Orion currently has no state income tax return positions in the process of examination, administrative appeals or litigation.\n\nUncertain tax positions\n\nAs of March 31, 2026, the balance of gross unrecognized tax benefits was approximately $0.3 million, all of which would affect Orion’s effective tax rate if recognized.\n\n70\n\n \n\nOrion has classified the amounts recorded for uncertain tax benefits in the balance sheet as other liabilities (non-current) to the extent that payment is not anticipated within one year. Accrued interest and penalties for such unrecognized tax benefits as of March 31, 2026 and 2025 were $0.1 million. Orion had the following unrecognized tax benefit activity (dollars in thousands):\n\n \n\n \n\n \n\nFiscal Year Ended March 31,\n\n \n\n \n\n \n\n2026\n\n \n\n \n\n2025\n\n \n\n \n\n2024\n\n \n\nUnrecognized tax benefits as of beginning of fiscal year\n\n \n\n$\n\n248\n\n \n\n \n\n$\n\n237\n\n \n\n \n\n$\n\n225\n\n \n\nAdditions based on tax positions related to the current period positions\n\n \n\n \n\n1\n\n \n\n \n\n \n\n1\n\n \n\n \n\n \n\n1\n\n \n\nAdditions for tax positions of prior years\n\n \n\n \n\n11\n\n \n\n \n\n \n\n10\n\n \n\n \n\n \n\n11\n\n \n\nUnrecognized tax benefits as of end of fiscal year\n\n \n\n$\n\n260\n\n \n\n \n\n$\n\n248\n\n \n\n \n\n$\n\n237\n\n \n\n \n\nNOTE 14 — COMMITMENTS AND CONTINGENCIES\n\nPurchase Commitments\n\nOrion enters into non-cancellable purchase commitments for certain inventory items in order to secure better pricing and ensure materials on hand. As of March 31, 2026, Orion had entered into $7.8 million of purchase commitments related primarily to inventory purchases. Orion expects the purchase commitments to be fulfilled during fiscal 2027.\n\nRetirement Savings Plan\n\nOrion sponsors a tax deferred retirement savings plan that permits eligible employees to contribute varying percentages of their compensation up to the limit allowed by the Internal Revenue Service. This plan also provides for discretionary contributions by Orion. In fiscal 2026, 2025 and 2024, Orion made matching contributions of approximately $0.1 million, $0.1 million, and $0.2 million, respectively.\n\nLitigation\n\nOrion is subject to various claims and legal proceedings arising in the ordinary course of business. As of the date of this report, Orion does not believe that the final resolution of any of such claims or legal proceedings would have a material adverse effect on its future results of operations.\n\nNOTE 15 — SHAREHOLDERS’ EQUITY\n\nReverse Stock Split\n\nOn August 22, 2025, Orion effected a 1-for-10 reverse stock split of its common stock in order to remain compliant with the Minimum Bid Price Rule. The par value was not adjusted for the reverse stock split. All share and per share data have been adjusted for all periods presented to reflect the reverse stock split.\n\nEmployee Stock Purchase Plan\n\nIn August 2010, Orion’s Board of Directors approved a non-compensatory employee stock purchase plan, or ESPP. The ESPP authorizes 250,000 shares to be issued from treasury or authorized shares to satisfy employee share purchases under the ESPP. All full-time employees of Orion are eligible to be granted a non-transferable purchase right each calendar quarter to purchase directly from Orion up to $20,000 of Orion’s common stock at a purchase price equal to 100% of the closing sale price of Orion’s common stock on The NASDAQ Capital Market on the last trading day of each quarter.\n\n \n\nSale of Shares\n\nIn March 2023, Orion filed a universal shelf registration statement with the Securities and Exchange Commission. Under the shelf registration statement, Orion currently has the flexibility to publicly offer and sell from time to time up to $100 million of debt and/or\n\n71\n\n \n\nequity securities. The filing of the shelf registration statement may help facilitate Orion’s ability to raise public equity or debt capital to expand existing businesses, fund potential acquisitions, invest in other growth opportunities, repay existing debt, or for other general corporate purposes.\n\nIn March 2021, Orion entered into an At Market Issuance Sales Agreement to undertake an “at the market” (ATM) public equity capital raising program pursuant to which Orion may offer and sell shares of common stock, having an aggregate offering price of up to $50 million from time to time through or to the Agent, acting as sales agent or principal. In March 2025, the ATM was terminated.\n\nOn February 2, 2026, Orion issued 500,000 shares of its common stock at a price to the public of $14.00 per share pursuant to a firmly underwritten public offering. Net proceeds form the offering of approximately $6.4 million were used to reduce amounts outstanding under Orion's Credit Agreement, with the remainder used for working capital and general corporate purposes.\n\nNOTE 16 — RESTRICTED SHARES\n\nAt Orion’s 2023 annual meeting of shareholders, Orion’s shareholders approved the Orion Energy Systems, Inc. 2016 Omnibus Incentive Plan, as amended and restated (the “Amended 2016 Plan”). Approval of the Amended 2016 Plan increased the number of shares of Orion’s common stock available for issuance under the Amended 2016 Plan from 350,000 shares to 600,000 shares (an increase of 250,000 shares). As of March 31, 2026, the number of shares available for grant under the Amended 2016 Plan was 56,587.\n\nThe Amended 2016 Plan authorizes grants of equity-based and incentive cash awards to eligible participants designated by the Plan's administrator. Awards under the Amended 2016 Plan may consist of stock options, stock appreciation rights, performance shares, performance units, common stock, restricted stock, restricted stock units, incentive awards or dividend equivalent units.\n\nPrior to the Amended 2016 Plan, the Company maintained its 2004 Stock and Incentive Awards Plan, as amended, which authorized the grant of cash and equity awards to employees (the “2004 Plan”). No new awards are being granted under the 2004 Plan; and no awards granted under the 2004 Plan remain outstanding. Forfeited awards originally issued under the 2004 Plan are canceled and are not available for subsequent issuance under the 2004 Plan or under the Amended 2016 Plan.\n\nCertain non-employee directors have from time to time elected to receive stock awards in lieu of cash compensation pursuant to elections made under Orion’s non-employee director compensation program. The Amended 2016 Plan also permits accelerated vesting in the event of certain changes of control of Orion as well as under other special circumstances.\n\nOrion historically granted stock options and restricted stock under the 2004 Plan. Orion did not issue stock options from fiscal 2015 through fiscal 2025 and instead had issued only restricted stock and performance shares. In fiscal 2026, stock options were granted along with restricted stock.\n\nOrion added performance conditions to a portion of the annual long-term incentive grants for Orion's executive compensation program. The performance-vesting restricted stock will vest to the extent Orion achieves revenue growth targets over a three-year period. Orion recognizes performance-vesting restricted stock expense ratably over the requisite service period based on the likelihood of meeting the performance conditions. For the fiscal years ended March 31, 2026, 2025, and 2024, Orion recognized $0 million, $0 million, and $0.3 million in stock-based compensation expense for performance-vesting restricted stock, respectively.\n\nThe following amounts of stock-based compensation expense for restricted shares were recorded (dollars in thousands):\n\n \n\n \n\n \n\nFiscal Year Ended March 31,\n\n \n\n \n\n \n\n2026\n\n \n\n \n\n2025\n\n \n\n \n\n2024\n\n \n\nCost of product revenue\n\n \n\n$\n\n—\n\n \n\n \n\n$\n\n7\n\n \n\n \n\n$\n\n5\n\n \n\nGeneral and administrative (1)\n\n \n\n \n\n434\n\n \n\n \n\n \n\n1,111\n\n \n\n \n\n \n\n923\n\n \n\nSales and marketing\n\n \n\n \n\n46\n\n \n\n \n\n \n\n31\n\n \n\n \n\n \n\n17\n\n \n\nResearch and development\n\n \n\n \n\n3\n\n \n\n \n\n \n\n8\n\n \n\n \n\n \n\n5\n\n \n\n \n\n$\n\n483\n\n \n\n \n\n$\n\n1,157\n\n \n\n \n\n$\n\n950\n\n \n\n \n\n72\n\n \n\n(1)\nThe termination of Michael Jenkins on April 14, 2025, led to the acceleration of approximately $251 thousand in relation to approximately 322 thousand restricted shares. Mr. Jenkins forfeited approximately 646 thousand performance shares and approximately 78 thousand shares of restricted stock in connection with his termination. The expense was recognized as of March 31, 2025 as it was determined estimable. The shares were accelerated and forfeited as of the termination date, April 14, 2025.\n\nThe following table summarizes information with respect to performance-vesting restricted stock and time vesting-restricted stock activity:\n\n \n\n \n\nTime-Based\nRestricted Shares\n\n \n\n \n\nPerformance-Based\nRestricted Shares\n\n \n\n \n\n \n\nShares\n\n \n\n \n\nWeighted\nAverage\nFair Value\nPrice\n\n \n\n \n\nShares\n\n \n\n \n\nWeighted\nAverage\nFair Value\nPrice\n\n \n\nBalance at March 31, 2025\n\n \n\n \n\n133,159\n\n \n\n \n\n$\n\n13.00\n\n \n\n \n\n \n\n152,994\n\n \n\n \n\n$\n\n14.30\n\n \n\nShares issued\n\n \n\n \n\n66,038\n\n \n\n \n\n$\n\n6.13\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\nShares vested\n\n \n\n \n\n(73,332\n\n)\n\n \n\n$\n\n14.44\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\nShares forfeited\n\n \n\n \n\n(11,787\n\n)\n\n \n\n$\n\n10.19\n\n \n\n \n\n \n\n(105,929\n\n)\n\n \n\n$\n\n14.72\n\n \n\nShares outstanding at March 31, 2026\n\n \n\n \n\n114,078\n\n \n\n \n\n$\n\n8.40\n\n \n\n \n\n \n\n47,065\n\n \n\n \n\n$\n\n10.90\n\n \n\nPer share price on grant date\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nDuring fiscal 2026, Orion recognized $0.5 million of stock-based compensation expense related to restricted shares.\n\nAs of March 31, 2026, 2025 and 2024, the weighted average grant-date fair value of restricted shares granted was $6.13, $10.68 and $14.16, respectively. The total fair value of shares vested during fiscal years ended March 31, 2026, 2025 and 2024 are $1.1 million, $0.9 million and $0.8 million, respectively.\n\nUnrecognized compensation cost related to non-vested common stock-based compensation as of March 31, 2026 is expected to be recognized as follows (dollars in thousands):\n\n \n\nFiscal 2027\n\n \n\n$\n\n576\n\n \n\nFiscal 2028\n\n \n\n \n\n216\n\n \n\nFiscal 2029\n\n \n\n \n\n40\n\n \n\nTotal\n\n \n\n$\n\n832\n\n \n\nRemaining weighted average expected years\n\n \n\n0.74\n\n \n\n \n\nNOTE 17 — SEGMENT DATA\n\nOrion evaluates and reports its business using three segments: Orion lighting segment, Orion maintenance segment and Orion electric vehicle charging segment. Orion configured its fiscal 2025 budget in order to compare actual performance to plan performance for these segments. Orion's CODM is the chief executive officer. The Company's CODM focuses primarily on each segment's ability to generate sufficient revenues and manage cost of services along with operating expenses. As such, the CODM measures operating performance at the segment level based on operating income or loss, including evaluation of budget to actual variances. Reportable segments are components of an entity that have separate financial data that the CODM regularly reviews when allocating resources and assessing performance.\n\nLighting Segment\n\nThe lighting segment develops and sells lighting products and provides construction and engineering services for Orion's commercial lighting and energy management systems. The lighting segment provides engineering, design, lighting products and in many cases turnkey solutions for large national accounts, governments, municipalities, schools and other customers. The lighting segment\n\n73\n\n \n\nsells mostly through direct sales, but it also sells lighting products though manufacturer representative agencies and to the wholesale contractor markets through energy service companies and contractors.\n\nMaintenance Segment\n\nThe maintenance segment provides retailers, distributors and other businesses with maintenance, repair and replacement services for the lighting and related electrical components deployed in their facilities.\n\nEV Segment\n\nThe EV segment offers leading electric vehicle charging expertise, sells and installs sourced electric vehicle charging stations with related software subscriptions and renewals and provides EV turnkey installation solutions with ongoing support to all commercial verticals.\n\nCorporate and Other\n\nCorporate and other is comprised of operating expenses not directly allocated to Orion’s segments and adjustments to reconcile to consolidated results.\n\n \n\nYear ended March 31, 2026\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n(dollars in thousands)\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nLighting\n\n \n\nMaintenance\n\n \n\nEV\n\n \n\nCorporate & Other\n\n \n\nTotal\n\n \n\nProduct revenue\n\n$\n\n41,173\n\n \n\n$\n\n7,293\n\n \n\n$\n\n8,563\n\n \n\n$\n\n—\n\n \n\n$\n\n57,029\n\n \n\nService revenue\n\n \n\n14,707\n\n \n\n \n\n8,749\n\n \n\n \n\n5,821\n\n \n\n \n\n—\n\n \n\n \n\n29,277\n\n \n\nTotal revenue\n\n \n\n55,880\n\n \n\n \n\n16,042\n\n \n\n \n\n14,384\n\n \n\n \n\n—\n\n \n\n \n\n86,306\n\n \n\nCost of product revenue\n\n \n\n27,834\n\n \n\n \n\n3,976\n\n \n\n \n\n5,083\n\n \n\n \n\n—\n\n \n\n \n\n36,893\n\n \n\nCost of service revenue\n\n \n\n9,568\n\n \n\n \n\n7,871\n\n \n\n \n\n3,881\n\n \n\n \n\n—\n\n \n\n \n\n21,320\n\n \n\nTotal cost of revenue\n\n \n\n37,402\n\n \n\n \n\n11,847\n\n \n\n \n\n8,964\n\n \n\n \n\n—\n\n \n\n \n\n58,213\n\n \n\nGross profit\n\n \n\n18,478\n\n \n\n \n\n4,195\n\n \n\n \n\n5,420\n\n \n\n \n\n—\n\n \n\n \n\n28,093\n\n \n\nOperating expenses:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nGeneral and administrative\n\n \n\n7,669\n\n \n\n \n\n2,451\n\n \n\n \n\n4,946\n\n \n\n \n\n3,625\n\n \n\n \n\n18,691\n\n \n\nSales and marketing\n\n \n\n8,175\n\n \n\n \n\n435\n\n \n\n \n\n1,037\n\n \n\n \n\n452\n\n \n\n \n\n10,099\n\n \n\nResearch and development\n\n \n\n459\n\n \n\n \n\n143\n\n \n\n \n\n85\n\n \n\n \n\n258\n\n \n\n \n\n945\n\n \n\nTotal operating expenses\n\n \n\n16,303\n\n \n\n \n\n3,029\n\n \n\n \n\n6,068\n\n \n\n \n\n4,335\n\n \n\n \n\n29,735\n\n \n\nLoss from operations\n\n \n\n2,175\n\n \n\n \n\n1,166\n\n \n\n \n\n(648\n\n)\n\n \n\n(4,335\n\n)\n\n \n\n(1,642\n\n)\n\nOther income (expense):\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nOther income\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n51\n\n \n\nInterest income\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n3\n\n \n\nInterest expense\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n(783\n\n)\n\nAmortization of debt issue costs\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n(170\n\n)\n\nLoss on debt extinguishment\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n(562\n\n)\n\nTotal other expense\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n(1,461\n\n)\n\nLoss before income tax\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n$\n\n(3,103\n\n)\n\n \n\n74\n\n \n\n \n\nYear ended March 31, 2025\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n(dollars in thousands)\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nLighting\n\n \n\nMaintenance\n\n \n\nEV\n\n \n\nCorporate & Other\n\n \n\nTotal\n\n \n\nProduct revenue\n\n$\n\n40,045\n\n \n\n$\n\n5,902\n\n \n\n$\n\n8,421\n\n \n\n$\n\n—\n\n \n\n$\n\n54,368\n\n \n\nService revenue\n\n \n\n7,659\n\n \n\n \n\n9,288\n\n \n\n \n\n8,405\n\n \n\n \n\n—\n\n \n\n \n\n25,352\n\n \n\nTotal revenue\n\n \n\n47,704\n\n \n\n \n\n15,190\n\n \n\n \n\n16,826\n\n \n\n \n\n—\n\n \n\n \n\n79,720\n\n \n\nCost of product revenue\n\n \n\n28,664\n\n \n\n \n\n3,215\n\n \n\n \n\n5,440\n\n \n\n \n\n-\n\n \n\n \n\n37,319\n\n \n\nCost of service revenue\n\n \n\n6,332\n\n \n\n \n\n9,207\n\n \n\n \n\n6,626\n\n \n\n \n\n—\n\n \n\n \n\n22,165\n\n \n\nTotal cost of revenue\n\n \n\n34,996\n\n \n\n \n\n12,422\n\n \n\n \n\n12,066\n\n \n\n \n\n—\n\n \n\n \n\n59,484\n\n \n\nGross profit\n\n \n\n12,708\n\n \n\n \n\n2,768\n\n \n\n \n\n4,760\n\n \n\n \n\n—\n\n \n\n \n\n20,236\n\n \n\nOperating expenses:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nGeneral and administrative\n\n \n\n6,083\n\n \n\n \n\n3,075\n\n \n\n \n\n5,423\n\n \n\n \n\n3,427\n\n \n\n \n\n18,008\n\n \n\nSales and marketing\n\n \n\n8,800\n\n \n\n \n\n685\n\n \n\n \n\n1,578\n\n \n\n \n\n532\n\n \n\n \n\n11,595\n\n \n\nResearch and development\n\n \n\n588\n\n \n\n \n\n196\n\n \n\n \n\n115\n\n \n\n \n\n330\n\n \n\n \n\n1,229\n\n \n\nTotal operating expenses\n\n \n\n15,471\n\n \n\n \n\n3,956\n\n \n\n \n\n7,116\n\n \n\n \n\n4,289\n\n \n\n \n\n30,832\n\n \n\nLoss from operations\n\n \n\n(2,763\n\n)\n\n \n\n(1,188\n\n)\n\n \n\n(2,356\n\n)\n\n \n\n(4,289\n\n)\n\n \n\n(10,596\n\n)\n\nOther income (expense):\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nOther income\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n62\n\n \n\nInterest income\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n7\n\n \n\nInterest expense\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n(1,026\n\n)\n\nAmortization of debt issuance cost\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n(206\n\n)\n\nTotal other expense\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n(1,163\n\n)\n\nLoss before income tax\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n$\n\n(11,759\n\n)\n\n \n\nYear ended March 31, 2024\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n(dollars in thousands)\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nLighting\n\n \n\nMaintenance\n\n \n\nEV\n\n \n\nCorporate & Other\n\n \n\nTotal\n\n \n\nProduct revenue\n\n$\n\n50,319\n\n \n\n$\n\n4,687\n\n \n\n$\n\n8,301\n\n \n\n$\n\n—\n\n \n\n$\n\n63,307\n\n \n\nService revenue\n\n \n\n10,783\n\n \n\n \n\n12,460\n\n \n\n \n\n4,031\n\n \n\n \n\n—\n\n \n\n \n\n27,274\n\n \n\nTotal revenue\n\n \n\n61,102\n\n \n\n \n\n17,147\n\n \n\n \n\n12,332\n\n \n\n \n\n—\n\n \n\n \n\n90,581\n\n \n\nCost of product revenue\n\n \n\n36,490\n\n \n\n \n\n2,339\n\n \n\n \n\n5,637\n\n \n\n \n\n—\n\n \n\n \n\n44,466\n\n \n\nCost of service revenue\n\n \n\n7,800\n\n \n\n \n\n14,060\n\n \n\n \n\n3,344\n\n \n\n \n\n—\n\n \n\n \n\n25,204\n\n \n\nTotal cost of sales\n\n \n\n44,290\n\n \n\n \n\n16,399\n\n \n\n \n\n8,981\n\n \n\n \n\n—\n\n \n\n \n\n69,670\n\n \n\nGross profit\n\n \n\n16,812\n\n \n\n \n\n748\n\n \n\n \n\n3,351\n\n \n\n \n\n—\n\n \n\n \n\n20,911\n\n \n\nOperating expenses:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nGeneral and administrative\n\n \n\n6,516\n\n \n\n \n\n4,517\n\n \n\n \n\n3,649\n\n \n\n \n\n2,058\n\n \n\n \n\n16,740\n\n \n\nImpairment of intangibles\n\n \n\n—\n\n \n\n \n\n456\n\n \n\n \n\n—\n\n \n\n \n\n—\n\n \n\n \n\n456\n\n \n\nSales and marketing\n\n \n\n10,813\n\n \n\n \n\n928\n\n \n\n \n\n1,146\n\n \n\n \n\n101\n\n \n\n \n\n12,988\n\n \n\nResearch and development\n\n \n\n809\n\n \n\n \n\n359\n\n \n\n \n\n102\n\n \n\n \n\n225\n\n \n\n \n\n1,495\n\n \n\nAcquisition-related costs\n\n \n\n21\n\n \n\n \n\n11\n\n \n\n \n\n17\n\n \n\n \n\n7\n\n \n\n \n\n56\n\n \n\nTotal operating expenses\n\n \n\n18,159\n\n \n\n \n\n6,271\n\n \n\n \n\n4,914\n\n \n\n \n\n2,391\n\n \n\n \n\n31,735\n\n \n\nLoss from operations\n\n \n\n(1,347\n\n)\n\n \n\n(5,523\n\n)\n\n \n\n(1,563\n\n)\n\n \n\n(2,391\n\n)\n\n \n\n(10,824\n\n)\n\nOther income (expense):\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nOther income\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n39\n\n \n\nInterest income\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n2\n\n \n\nInterest expense\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n(752\n\n)\n\nAmortization of debt issuance cost\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n(95\n\n)\n\nOther income (expense)\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n(806\n\n)\n\nLoss before income tax\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n$\n\n(11,630\n\n)\n\n \n\n75\n\n \n\n \n\n \n\n \n\nDepreciation and Amortization\n\n \n\n \n\nCapital Expenditures\n\n \n\n \n\n \n\nFor the year ended March 31,\n\n \n\n \n\nFor the year ended March 31,\n\n \n\n(dollars in thousands)\n\n \n\n2026\n\n \n\n \n\n2025\n\n \n\n \n\n2024\n\n \n\n \n\n2026\n\n \n\n \n\n2025\n\n \n\n \n\n2024\n\n \n\nSegments:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n Lighting Segment\n\n \n\n$\n\n597\n\n \n\n \n\n$\n\n868\n\n \n\n \n\n$\n\n747\n\n \n\n \n\n$\n\n7\n\n \n\n \n\n$\n\n26\n\n \n\n \n\n$\n\n92\n\n \n\n Maintenance Segment\n\n \n\n \n\n167\n\n \n\n \n\n \n\n386\n\n \n\n \n\n \n\n453\n\n \n\n \n\n \n\n1\n\n \n\n \n\n \n\n2\n\n \n\n \n\n \n\n535\n\n \n\n EV Segment\n\n \n\n \n\n775\n\n \n\n \n\n \n\n1,083\n\n \n\n \n\n \n\n979\n\n \n\n \n\n \n\n-\n\n \n\n \n\n \n\n2\n\n \n\n \n\n \n\n56\n\n \n\nCorporate and Other\n\n \n\n \n\n245\n\n \n\n \n\n \n\n281\n\n \n\n \n\n \n\n411\n\n \n\n \n\n \n\n75\n\n \n\n \n\n \n\n69\n\n \n\n \n\n \n\n154\n\n \n\n \n\n \n\n$\n\n1,784\n\n \n\n \n\n$\n\n2,618\n\n \n\n \n\n$\n\n2,590\n\n \n\n \n\n$\n\n83\n\n \n\n \n\n$\n\n99\n\n \n\n \n\n$\n\n837\n\n \n\n \n\n \n\n \n\nTotal Assets\n\n \n\n(dollars in thousands)\n\n \n\nMarch 31, 2026\n\n \n\n \n\nMarch 31, 2025\n\n \n\nSegments:\n\n \n\n \n\n \n\n \n\n \n\n \n\n Lighting Segment\n\n \n\n$\n\n26,185\n\n \n\n \n\n$\n\n20,646\n\n \n\n Maintenance Segment\n\n \n\n \n\n3,697\n\n \n\n \n\n \n\n4,384\n\n \n\n EV Segment\n\n \n\n \n\n7,505\n\n \n\n \n\n \n\n11,963\n\n \n\nCorporate and Other\n\n \n\n \n\n14,218\n\n \n\n \n\n \n\n15,470\n\n \n\n \n\n$\n\n51,605\n\n \n\n \n\n$\n\n52,463\n\n \n\n \n\nOrion’s lighting segment revenue outside the United States was $1.5 million, $1.8 million and $6.4 million for the fiscal years ended March 31, 2026, 2025 and 2024, respectively. All other revenues are generated from the United States. Orion attributes revenues from external customers to individual countries based on the geographic location in which the work is performed. Orion has no long-lived assets outside the United States.\n\n \n\nNOTE 18 - RESTRUCTURING\n\n \n\nAs part of Orion's restructuring effort, a further reduction in workforce was completed in the fourth quarter of fiscal 2025. Total severance expense for fiscal 2025 was $595 thousand. In addition, an inventory write-off of approximately $197 thousand was recognized in the first quarter of fiscal 2025 for inventory related to a customer Orion no longer does business with due to the restructuring, along with a lease breakage fee of $125 thousand that occurred in the second quarter of fiscal 2025 due to the closing of the Pewaukee office. Orion's restructuring expense and other related costs for the 12 months ended March 31 2026, 2025 and 2024 are reflected within its consolidated statement of operations as follows (dollars in thousands):\n\n \n\n \n\nFiscal Year Ended March 31,\n\n \n\n \n\n \n\n2026\n\n \n\n \n\n2025\n\n \n\n \n\n2024\n\n \n\nCost of product revenue\n\n \n\n$\n\n—\n\n \n\n \n\n$\n\n295\n\n \n\n \n\n$\n\n26\n\n \n\nCost of service revenue\n\n \n\n \n\n—\n\n \n\n \n\n \n\n176\n\n \n\n \n\n \n\n48\n\n \n\nGeneral and administrative\n\n \n\n \n\n—\n\n \n\n \n\n \n\n442\n\n \n\n \n\n \n\n28\n\n \n\nSales and marketing\n\n \n\n \n\n—\n\n \n\n \n\n \n\n26\n\n \n\n \n\n \n\n21\n\n \n\nResearch and development\n\n \n\n \n\n—\n\n \n\n \n\n \n\n109\n\n \n\n \n\n \n\n—\n\n \n\n \n\n$\n\n—\n\n \n\n \n\n$\n\n1,048\n\n \n\n \n\n \n\n123\n\n \n\nTotal restructuring expense and other related costs by segment was recorded as follows (dollars in thousands):\n\n \n\n \n\nFiscal Year Ended March 31,\n\n \n\n \n\n \n\n2026\n\n \n\n \n\n2025\n\n \n\n \n\n2024\n\n \n\nSegments:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nLighting\n\n \n\n$\n\n—\n\n \n\n \n\n$\n\n246\n\n \n\n \n\n$\n\n52\n\n \n\nMaintenance\n\n \n\n \n\n—\n\n \n\n \n\n \n\n720\n\n \n\n \n\n \n\n48\n\n \n\nEV\n\n \n\n \n\n—\n\n \n\n \n\n \n\n14\n\n \n\n \n\n \n\n—\n\n \n\nCorporate and Other\n\n \n\n \n\n—\n\n \n\n \n\n \n\n68\n\n \n\n \n\n \n\n23\n\n \n\n \n\n$\n\n—\n\n \n\n \n\n$\n\n1,048\n\n \n\n \n\n$\n\n123\n\n \n\n \n\n \n\n \n\n76\n\n \n\nNOTE 19 - SUBSEQUENT EVENTS\n\n \n\nOn May 29, 2026, Orion, with Bank of America, N.A. as lender, executed Amendment No. 5 (“Amendment No. 5”) to its Credit Agreement. The primary purpose of Amendment No. 5 was to extend the maturity date of the Credit Facility from June 30, 2027 to June 30, 2030.\n\nIn February 2026, the U.S. Supreme Court ruled that certain tariffs imposed under the International Emergency Economic Powers Act (“IEEPA”) were unlawful. On April 20, 2026, U.S. Customs and Border Protection launched a portal intended to automate and consolidate the related refund claim process, including associated interest payments. Orion submitted refund claims related to certain previously paid tariffs. Due to the uncertainly surrounding payment of any potential refund claims, no amounts are reflected in the fiscal 2026 financial statements. As of May 31, 2026, Orion has received approximately $219 thousand in tariff refunds, including approximately $13 thousand of interest income. The ultimate amount and timing of recovery remain subject to continued administrative review and claim approval.\n\n \n\n77"}